RBM goes live on Comesa payment system
Reserve Bank of Malawi (RBM) Governor Charles Chuka has said the
central bank has effected the Comesa Regional Payment and Settlement
System (REPSS) which went live on November 19.
RBM becomes the third central bank within the Common Market for
Eastern and Southern Africa (Comesa) to go live on the system since
its operations started on October 3 2012 and registered its first
transaction between Bramer Bank of Mauritius and Fina Bank of Rwanda,
through their respective central banks.
Chuka, addressing a 19th meeting of the Comesa committee meeting of
Finance and Monetary Affairs, described the rolling out of the payment
system by Malawi as a milestone in Comesa’s quest to achieve a
regional economic integration.
“In 2013, the Central Bank of Swaziland also went live on the system.
I am delighted to deliver the breaking news of the Reserve Bank of
Malawi going live on REPSS on 19th November 2013, just a few days
before our meeting,” Chuka informed the meeting.
The system, whose main participants are central banks, allows member
States to transfer funds within Comesa on the same day and at a lower
cost.
Chuka foresaw that the Comesa payment system will grow fast when the
critical mass is achieved, with the coming on board of the central
banks of Egypt, Kenya, Sudan, Uganda and Zambia which are expected to
go live very soon.
The RBM boss also informed the meeting that the central banks of
Democratic Republic of Congo (DRC) and Burundi have also started
preparations for joining REPSS and have indicated that they would be
aiming at going live by June 2014.
“It cannot be over emphasised that REPSS will indeed significantly
contribute to the expansion of intra-Comesa trade. I urge other member
central banks to expeditiously use REPSS for payments for their
intra-Comesa transactions.”
Finance Minister Maxwell Mkwezalamba told Business News last week that
a strong regional payment and settlement system will enhance
intra-Comesa business by cutting transaction costs.
The minister said that will happen through the reduction of foreign
funding to cover confirmation or drawings of letters of credit by
correspondents, foreign correspondent charges, collateral requirements
and settlement time period.
Economic analysts earlier hoped that payment system benefits exporters
and importers in the region by allowing for a faster, safe and secure
transfer of funds.
Other benefits include the predictability in payment timing and
reduced payment cycle time as compared to other international payment
alternatives.
REPSS also compliments other payment solutions already in use in the
region and will help integrate payment platforms to achieve Comesa’s
vision of economic integration.
