Egypt central bank joins Pan-African Payment and Settlement System

The step is part of Egypt's ongoing commitment to strengthening regional banking ties and enhancing economic cooperation with African nations.

The PAPSS, developed by the African Export-Import Bank (Afreximbank), eases cross-border payments and trade transactions, reducing costs and processing time.

It serves as a financial market infrastructure facilitating payment transactions across Africa.

The system allows cross-border transactions in local currencies across Africa through three core processes: instant payment, pre-funding, and net settlement.

The PAPSS is expected to boost intra-African trade, Egypt's economic relations with African countries, and financial integration across the continent.

Moreover, it will ease the pressure on foreign currency demand using a net settlement mechanism across all participating countries.

This, in turn, is expected to increase bilateral trade between Egypt and other African nations.

"CBE’s participation in the new system reflects Egypt's commitment to enhancing commercial and economic ties with countries worldwide, particularly African nations," CBE Deputy Governor Rami Aboulnaga said.

This development resulted from ongoing communication and cooperation between the CBE and other African central banks, Aboulnaga emphasized.

He noted that the multiple advantages of PAPSS are expected to encourage both Egyptian and African banks to join the system, fostering cross-border financial transactions.

Additionally, the system currently includes 14 other central banks from Nigeria, Ghana, Liberia, Guinea, Gambia, Sierra Leone, Djibouti, Zimbabwe, Zambia, Kenya, Rwanda, Malawi, Tunisia, and Comoros, as well as over 50 commercial banks.

Several Egyptian banks have already expressed interest in joining the PAPSS. Under the agreement, the CBE will manage their participation in the system.