Africa’s journey towards an integrated digital payments landscape and how the EU can support it
Ensuring the interoperability of digital instant payment solutions across borders will be vital to increasing inclusive trade under the African Continental Free Trade Area. Ennatu Domingo and Chloe Teevan look at solutions to cross-border interoperability, challenges and opportunities, and how the EU could support Africa.
In recent years, Africa has experienced a rapid proliferation of digital instant payment solutions. However, many of these are not interoperable with each other, and even less so across borders.
In 2021, Africa accounted for 70% of the total value of mobile money transactions globally. In recent years, the continent has experienced a rapid proliferation of digital instant payment solutions. However, many of these are not interoperable with each other, and even less so across borders. As Africa works towards building the African Continental Free Trade Area (AfCFTA), interoperability of cross-border instant payment solutions will be vital to increasing trade. Furthermore, ensuring cross-border interoperability of low value instant payment systems, notably mobile money, will be an essential step in making sure that the AfCFTA is inclusive, and that its benefits can extend to small-scale traders, many of whom are women.
This policy brief outlines why cross-border interoperability of payment platforms across Africa is important, where the opportunities and challenges lie, and how international partners such as the EU can support African efforts. It traces some of the solutions that are being applied both at the continental and at the regional levels, explores some of the lessons to be learned from these different cases, and proposes initial policy recommendations for the EU on how it could support Africa as it works towards developing inclusive interoperable instant payments systems.