RBM touts payment system for trade facilitation
The Reserve Bank of Malawi (RBM) says the Pan-African Payment and Settlement System (Paps) will enhance Malawi’s participation in global trade.
The remarks comes after RBM became the 12th central bank to join the international payment system championed by the Africa Import and Export Bank (Afreximbank) as a catalyst to revolutionise cross-border payments and boost intra-African trade
In an e-mailed response, RBM spokesperson Mark Lungu said joining the platform will allow cross-border transactions to be “processed expeditiously and in a more transparent manner”.
He said: “Papss will ease challenges that countries within the continent face when processing cross-border transactions as a result, it is expected that trade within Africa will increase which should have a positive impact on member countries’ economies.
“Meanwhile, many banks rely on the correspondent banking model which is slower and a bit expensive as compared to Papss.”
Papss chief executive officer Mike Ogballu is on record as having said onboarding on the African Continental Free Trade Agreement-supported platform will stimulate trade diversification, economic resilience and sustainable development for all participating countries.
The Papps system is operational in six countries of the West African Monetary Zone.
It works in collaboration with Africa’s central banks to provide a payment and settlement service in local currency such as the kwacha instead of the US dollar to which commercial banks and licensed payment service providers across the region can connect as ‘participants’.
