The East African Community (EAC) is urging its central banks to adopt technology to improve cross-border payments within the region.
EAC Secretary General Veronica Nduva highlighted challenges such as limited capacity, lack of interoperability, and security concerns that hinder the use of the East African Payments System (EAPS), launched in 2014.
Ms. Nduva while in Arusha, Tanzania on September 11, 2024 emphasized that an efficient payment system is crucial for boosting intra-regional trade and investment.
“Moving money from one Partner State to another is still slow and expensive. Interoperability of digital payment systems at regional level is missing. Uptake of the East African Payment System (EAPS) has been very low. As a result, most banks in the region still use foreign correspondent banks to effect regional cross border payments,” said the EAC Secretary General.
Despite advancements in domestic digital financial services, cross-border payments remain slow and costly due to poor interoperability and low EAPS uptake.
At a two-day forum on payment system coordination, Nduva and other experts, including representatives from the Bill and Melinda Gates Foundation and TradeMark Africa, stressed the importance of harmonizing policies and enhancing infrastructure to improve regional financial integration.
The African Development Bank and GIZ-EAC Project also supported these goals, underscoring the need for a robust digital market to facilitate trade.