President William Ruto has offered to host the Pan-African Payment Settlement System (PAPPS) headquarters in Nairobi.
PAPPS, supported by African Heads of State, is a cross-border financial market infrastructure facilitating payment transactions throughout Africa. It aims to promote trading in local currencies, reducing reliance on the dollar and minimizing foreign exchange costs.
African Presidents have proposed adopting the system by February 2024.
While addressing the African Continental Free Trade Area (ACFTA) Conference at Strathmore University on Tuesday, President William Ruto stated that Kenya had accepted to host the headquarters, especially since Kenya has positioned itself as a champion for continental integration.
''We have been asked to host the headquarters of the Pan African Payment System in Kenya and because we are leaders in the technology space and because we are also promoters of African African Continent Free Trade Area,'' Ruto stated.
President William Ruto lamented that Africa loses Ksh5 billion when trading in different currencies.
The system that was launched in January 2022 will not replace the existing systems but rather integrate them into one system that will allow cross-border trade.
The integrated system was launched by the African Union (AU) and the African Export-Import Bank (Afreximbank), however, since its inauguration, it has yet to be adopted by the majority of African countries.
PAPSS streamlines the payment process by allowing the originator to instruct their local bank in their native currency.
Once the instruction is sent, PAPSS validates the payment and forwards the prompt to the receiver's bank.
Upon approval, the receiver is credited in their local currency.
This system, when adopted continent-wide, will enhance Africa's trading framework for governments, banks, payment providers, corporations, and various enterprises, fostering seamless transactions and efficient financial interactions.
