The Pan African Payments and Settlement System (PAPPS) is the intra-African trade and commerce payments, centralised payment and settlement system. With the participation of banks and fintechs, the deployment of this system is expected to contribute to solving the issue of low intra-African Trade.
Speaking at The Money Summit, Head of Product Management at Hubtel – one of the leading names in fintech companies in Ghana – Patrick Asare-Frimpong said: “The way to increase intra-Africa Trade is by a matter of putting enough tools that enable fintechs to innovate around all the protocols available on PAPPS. The absence of this will not encourage fintechs to innovate”.
This was in the first plenary session with a panel of industry experts discussing the challenges, opportunities and the way forward for Africa’s payment and settlement system with respect to the introduction of PAPPS.
PAPSS, hailed as a game-changer for intra-African Trade, is expected to be the most important component of the African Continental Free Trade Area (AfCFTA) because it promises to save businesses across the continent US$5billion in transaction costs each year, with trade between African countries expected to increase by 22 percent by 2040 and generate an additional US$70billion in value. However, some challenges need addressing.
Mr. Asare-Frimpong added: “Issues like the fastest time for transfers on PAPPS being 10 secs are challenging because people always want their monies instantly. There are card transfers that take only about 2 secs.
“In recent times, Hubtel has conducted research amongst our customers, and we found that settlement is one of the major things for both businesses and individuals. It doesn’t matter the platform through which they send money; the recipient wants to get their money instantly. They want it in a second. If we cannot promise and deliver instant settlement, then there is a whole cloud of doubt and uncertainty that results in low trade,” he further stated.
Touching on the topic of Anti-Money Laundering, he asserted: “This (PAPPS) if done right is going to give us a strong arm and allow us to be able to operate as one entity, as a continent; and give us the ability not to let anybody come and push us over, especially if we can trade among ourselves profitably”
The first plenary session at this year’s Money Summit had a panel of industry experts including: Monica Oraro, Head of Product and Business Development, PAPPS; Dr. Settor Amediku, Head of Payment Systems at Bank of Ghana’ Ato Okyri, Group Head-Technology and Innovation at Letshego Group; and Chief Financial Officer at Fidelity Bank, Attah Yeboah Gyan. Prince Moses, General Manager for Asaase Radio, moderated the panel.
Business and Financial Times organised The Money Summit in partnership with the Bank of Ghana and support from Hubtel, Letshego, AZA Finance, FBN Bank, Fidelity Bank, Ghana Stock Exchange (GSE), and Securities and Exchange Commission (SEC), under the theme Africa’s Economic Growth: Facilitating Investment, Payments, and Settlement Systems.