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A Memorandum of Understanding (MoU) between Standard Bank of South Africa Limited and The Pan African Payment and Settlement System (PAPSS) has been signed to make it easier for the Group to settle cross-border transactions, including those of all its subsidiaries, using PAPSS.
The Agreement was signed on Monday, June 19, 2023, at the opening ceremony of the 30th Afreximbank Annual Meeting (AAM), which was held in Accra, Ghana. Professor Benedict Oramah, President of Afreximbank, H.E. Wamkele Mene, Secretary General of the AfCFTA, and other dignitaries attended the event.
PAPSS is a financial market infrastructure that was established by the African Export-Import Bank (Afreximbank) and the Africa Continental Free Trade Area (AfCFTA) Secretariat. It offers a secure and effective channel for processing cross-border payments, ensuring speed, affordability, and dependability to support intra-African trade.
The Commercial Bank Settlement Model, a new settlement model that gives commercial banks a window to open and fund their own settlement accounts at Afreximbank and manage their own liquidity in accordance with their banking needs, was also launched by PAPSS during the ceremony.
Standard Bank affiliates in more than 20 countries will be able to streamline and expedite the movement of cash by making use of PAPSS's capabilities, while also assuring transparency and compliance under the regulators' watchful eye. The collaboration also supports the goal of the African Union to strengthen financial connectivity in order to promote intra-African trade and economic integration. Standard Bank of South Africa and PAPSS are well-positioned to support the expansion and advancement of the African economy by utilizing their combined expertise.
The Chief Executive of Stanbic Bank Ghana Ltd, Mr. Kwamina Asomaning, made the following statement regarding the signing: "Standard Bank appreciates the chance to work with PAPSS on this project to drive intra-Africa trade and transactional flows between African countries. As a bank with operations in 20 different African nations, we prioritize the continent's development, and this cooperation reflects our goal of lowering trade obstacles, promoting the use of local currencies as the primary form of payment, and lowering transaction costs for conducting business there. After all, we will promote Africa's development because it is our home.
"We are thrilled to have Standard Bank Group, one of the biggest and most reputable banks in Africa, work with us toward our shared mission of making Africa more rich and successful," stated Mr. Mike Ogbalu III, Chief Executive Officer of PAPSS. Since the bank was among the first financial institutions in Nigeria to utilize PAPSS, we are hopeful that the remaining group subsidiaries would soon do the same.
Standard Bank Group continues to be at the forefront of innovation as the financial landscape is being shaped by the digital revolution. By working together, Standard Bank Group hopes to make use of PAPSS's cutting-edge payment infrastructure to increase financial inclusion, facilitate frictionless cross-border trade, and boost the continent of Africa's economic development.
In collaboration with the Central Banks of the nations in which Standard Bank conducts business, this MOU will be gradually implemented. As soon as the service is made available in their nations, Standard Bank customers in Africa will be notified through the customary channels of communication. The goal of PAPSS and Standard Bank is to make this service accessible beginning in January 2024.
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