ECOBANK Group, a leading pan-African banking group, and The Pan African Payment and Settlement System (PAPSS) have joined forces through a Memorandum of Understanding (MoU) to facilitate the settlement of cross-border transactions across the group, including its subsidiaries, using PAPSS. The signing of the MoU took place on Monday, June 19, 2023, during the opening ceremony of the 30th Afreximbank Annual Meeting (AAM) in Accra, Ghana.
PAPSS, established by the African Export-Import Bank (Afreximbank) and the Africa Continental Free Trade Area (AfCFTA) Secretariat, is a financial market infrastructure that offers a secure and efficient channel for processing cross-border payments. It aims to ensure speed, affordability, and reliability, thereby facilitating intra-African trade. As part of the ceremony, PAPSS introduced the Commercial Bank Settlement Model, which provides commercial banks with the opportunity to open and fund their settlement accounts at Afreximbank, enabling them to manage their liquidity according to their banking needs.
Through this partnership, Ecobank’s affiliates in 33 countries, serving over 32 million customers, will be able to streamline and expedite fund transfers while ensuring transparency and compliance under regulatory supervision. Moreover, the collaboration aligns with the African Union’s vision of promoting intra-African trade and economic integration by enhancing financial connectivity. By combining their expertise, Ecobank and PAPSS are poised to contribute to the growth and development of the African economy.
Expressing his thoughts on the agreement, Jeremy Awori, the Chief Executive Officer of Ecobank Group, stated, ‘Partnerships such as the one we have signed on PAPSS are essential for the delivery and success of the AfCFTA and for the financial integration and economic development of our continent. We are committed to the success of PAPSS and are pleased to bring on board our payments and collections expertise from our African coverage of 33 markets. This partnership ensures that all partner banks and PAPSS can expand their reach rapidly and enable greater and wider intra-African trade. Today, we begin to change and rewrite the narrative of low intra-African trade by removing the barrier to efficient and instant payments and collections in African currencies.’
Mike Ogbalu III, the Chief Executive Officer of PAPSS, expressed his gratitude for the cooperation of Ecobank Group, emphasising the transformative potential of PAPSS in revolutionising cross-border transactions across Africa. He said, ‘Having the cooperation of Ecobank Group, one of the major banks in Africa, is a huge honour, but more importantly, it shows that PAPSS is the payment system that will transform the way that people in Africa conduct cross-border transactions. To this end, I appreciate the bank’s management for having faith in PAPSS.”
Through this partnership, Ecobank Group and its subsidiaries will gain access to PAPSS’s advanced platform, enabling seamless settlement of cross-border transactions. By simplifying the complexities associated with traditional payment systems, the bank aims to provide its customers with a more convenient and streamlined experience, ultimately fostering increased trade and economic cooperation across Africa.
The implementation of this MoU will occur gradually in collaboration with the central banks in the countries where Ecobank Group operates. Customers across Africa will be informed through regular communication channels as soon as the service becomes available in their respective countries. PAPSS and Ecobank Group are working towards making this service available starting from January 2024.
