Could Africa crack instant cross-border payments?

Instant cross-border payments in Africa are held back by discrepancies in innovation and economic development. 

But with 74% of all mobile money accounts being from Africa, the continent has the potential to skip older legacy systems and find true innovation.

Could Africa crack instant cross-border payments?

Instant cross-border payments are the next biggest challenge for the payments industry. Could Africa be the place where true innovation is found?

Sending money abroad, for either B2B purposes or remittance, is a growing industry as the world shrinks. According to a source from FXCintelligence, the global cross-border payments market will reach a TAM of $320 trillion by 2032.

In May 2025, Oui Capital, an Africa-focused venture capital firm, released a report that projects that the African cross-border payments market will reach $1 trillion by 2035, up from $329 billion in 2025 – a CAGR of 12%.

However, cross-border payments in Africa are still plagued by complexities and general difficulty. 

Many cross-border payments companies in Africa have managed to streamline specific processes, bringing down transaction fees and reducing settlement times. However, a unified solution is yet to be found, as infrastructure development remains one of the biggest challenges for the continent. 

Why are cross-border payments difficult?

For anyone unaware of cross-border or international payments, the challenges are in the discrepancies between the rules and regulations of nations, combined with their imbalance of technological and economic innovation.

In theory, there is no difference between a domestic bank transfer and an international bank transfer. The fundamental bank transfer is the same, however, the cohesion between institutions is the blocker.

A bank must align itself with another bank across a border, and both must be fully transparent in their processes, and aligned in structure. As this is rarely a feasible method, correspondent banks, such as J.P. Morgan Chase or Wells Fargo, will act as the middlemen in this situation and handle the transaction on either end.

If banks do not have a direct relationship, then this is a necessary step to take, which is where the time, complexity and fees are added to the process.

Currently, the complexity is enormous in fixing something like this for an entire region. It would involve developing a ubiquitous framework which all existing technologies can integrate with and communicate with banks across borders.

Cross-border payments are the next big target for the payment industry, as the first country to crack cross-border payments and make them instant and/or fee-free will change the landscape forever.

Issues facing the African market

Infrastructure and regulation are the most significant barriers to entry.

As mentioned by Techpoint Africa, the differences in KYC are for many what makes cross-border payments in Africa such a challenge. 

Some countries in Africa, such as Nigeria (which came sixth on a list of countries with the most well-developed real-time payments systems), are highly developed in the payments world. 

Nigeria’s Inter-Bank Settlement System (NIBSS) developed in 1993, was imitated for the Pan-African Payment and Settlement System implemented in 2022. In March 2023, Nigeria went live with its Open Banking System, showing a framework that may be imitated across Africa in the years to come – a country like Nigeria might be 30 years ahead in terms of payment innovation compared to some of its neighbouring countries.

With this payment innovation context, Africa contains 19 of the 20 poorest countries in the world, creating an enormous gulf in technological development. Many of these nations have no formal KYC or AML processes, nor any infrastructure to handle cross-border transactions effectively. Building an effective cross-border solution would require these problems to be fixed before anything.

Bank account penetration rates are also significantly lower in these poorer nations. According to a report from the World Bank on bank account penetration rates, countries such as South Africa and Kenya are sitting at 85% and 79% respectively, whereas countries such as Burundi and South Sudan are at 17% and 6% respectively.  

This gulf in innovation and bank account usage is what sits in the way of streamlined payments.

A standardised system of KYC approval would need to be established, otherwise, more developed countries have no way to open up their payment systems.

Preference for cash

A large proportion of Africa operates offline. Cash usage in most African countries is very high, and according to a report from CIO, “over 40% of Africans don’t have banking accounts, and identity (verification) is still manual”.

Even with wealthier and more developed nations such as South Africa with a high bank penetration rate (85%), approximately 94% of adults withdraw cash each month, making bank transparency across borders a tough task.

Lack of government trust

Another potential blocker to this is a lack of government trust. Government trust in Africa is low, and is actually sinking even lower according to a study from Afrobarometer. From the survey of 39 African countries, it shows that between 2021 and 2023, there has been a significant decline in trust for institutions and leaders. The study showed that there is also a variation between the East and West, compared to Southern, Central and North Africa – another demonstration of the enormous variation between African countries.

A lack of government trust is a blocker to payment innovation, as citizens are far less likely to open bank accounts and trust government initiatives. Memories of banking crises and corruption will keep cash usage high, and cooperation with government schemes low.

List of the current cross-border payment systems

Africa already has several systems in place to support instant or low-cost cross-border payments, each one unique to two specific countries or a particular region.

Here are the current largest payment systems in place, currently facilitating cross-border payments in Africa.

GIMACPAY (CEMAC region)

GIMACPAY is an integrated electronic retail payment system for the Central African Economic and Monetary Community (CEMAC), which includes Cameroon, Central African Republic, Chad, Republic of Congo, Equatorial Guinea, and Gabon.

This solution is low-cost for both domestic and cross-border transactions. It supports interoperability between commercial banks, mobile money operators, microfinance institutions, and other payment service providers.

Transactions are cleared in real time using the region’s common currency (XAF, Central African Franc), with settlement conducted via the regional RTGS platform. GIMACPAY supports a wide range of channels, including apps, ATMs, POS, QR code, and USSD, and offers use cases such as P2P, P2B, cross-border, and bill payments.

PAPSS

The Pan-African Payment and Settlement System (PAPSS) is a cross-border financial market infrastructure that enables instant or near-instant payments between African countries.

Created in 2022 with a similar framework to Nigeria’s Inter-Bank Settlement System (NIBSS), it connects African banks, payment service providers, and financial market intermediaries, allowing instant payments in local currencies across borders.

TCIB 

The Transactions Cleared on an Immediate Basis (TCIB) is designed for the Southern African Development Community (SADC) region, which includes Angola, Botswana, Comoros, Congo (DRC), Eswatini, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Tanzania, Zambia, and Zimbabwe.

It enables instant, low-cost cross-border payments and interoperability between banks and non-bank financial institutions within SADC member states, supporting a variety of use cases, including remittances, merchant payments, and bill payments, and is part of efforts to deepen regional financial integration.

Future cross-border payment systems 

The WAEMU (West African Economic and Monetary Union) are currently working on a cross-border payment system to help payments among member states.

The 21 states of COMESA (Common Market for Eastern and Southern Africa) have made plans to establish instant cross-border payments within the region.

ECOWAS (the Economic Community of West African States), has put initiatives in place to design and implement payment systems for member states. 

There have been some loose suggestions for a unified currency called the eco, which could effectively create a unified payment system. However, the project has been derailed several times in the past, and for many economists, "remains an illusion".

The EAC (East African Community) is reportedly working towards cross-border payments with a so-called ‘cross-border payments’ master plan.

Why Africa could be where innovation happens

Despite the blockers, Africa is uniquely positioned for growth.

The continent represents 66% of global mobile money volumes, positioning it as a potential leader in instant cross-border payments.

Remittance is a foundation of the African economy too, and according to data from the World Bank, remittances to sub-Saharan Africa reached $54 billion in 2023. Therefore, despite the size and complexity of the African market, with some significant challenges, the necessity of the changes and the demand for lower fees and faster settlements is huge. 

Africa has an issue with high remittance rates, with Tanzania hitting the top spot at 27% on average (compared to a global average of 6.3%). This creates an incentive for customers to switch to instant cross-border payment solutions. While their trust in institutions might be low, the appeal of low-to-no-cost cross-border payments will be undeniable.

Mobile Money Boom

Africa is uniquely positioned as it has fewer legacy systems, and represents 66% of global mobile money volumes, positioning it as a potential leader in instant cross-border payments.

Consumers in Africa are skipping the banking stage and leading the mobile money revolution with approximately 1.1 billion mobile money accounts (a 14% YoY increase) and 74% of all mobile money transactions globally happening in Africa.

What might a banking system look like without legacy systems from the days of bank accounts?

Looking to the future

While Africa has to align on its technological innovation to provide cross-border transactions across the continent, the fact that it is leading the charge in the mobile money revolution makes for an exciting prospect.

As development continues, and fintech upgrades, offering payment solutions for specific countries, the payment systems in the regions are becoming smoother by the day.

Future innovation into crypto could also play a part, and if the eco is successfully rolled out and adopted, this could create a fully unified solution. The growing curiosity of central banks in creating CBDCs has led to Nigeria’s innovation of the eNaira, which, despite the perceived failure, could play a part in future innovation and cross-border innovation.

With the 14% CAGR of mobile money accounts, and the growth of the fintech sector, Africa could be where innovation in cross-border payments is finally found.

Author

Caleb is a financial copywriter with a specialisation in fintech and forex. Former copywriter at Barclays and Paysafe. Contributing writer for LiquidityFinder. You can message Caleb here.