Here is a simplified overview of how PAPSS works[4]
A company issues a payment instrument to their local bank or payment service provider
The payment instruction is sent to PAPSS through the country's central bank and routes it to the beneficiary bank account
PAPSS performs all validation checks on payment instruction before it sends it forwards it to the beneficiary's central bank and eventually to the local bank account
PAPSS sends credit or debit settlement instruction to the Central Bank of the originator and the Central Bank of the beneficiary. The Central Banks settle the transaction in hard currency, using Afreximbank as the settlement agent.
Once the cross-border net settlement is complete, the beneficiary receives the funds in their local currency.[5]
On a daily basis, PAPSS settles the balance of all of the transactions among individual African currencies, netting them out prior to midnight. Central Banks then resolve the remaining difference. The payments and settlement process starts again from net zero the next day.[6]
Central Banksedit
These are the banks enrolled in PAPSS (December 2023)[7]
^Ifeanyi, Ubah Jeremiah (14 January 2022). "PAPSS officially launched to aid payment transaction across Africa". Nairametrics. Retrieved 16 June 2023.
^ abSantosdiaz, Richie (25 June 2022). "Overview of The Pan-African Payment and Settlement System PAPSS". The Fintech Times. Retrieved 16 June 2023.
^"Decisions of the 12th Extraordinary Session of the Assembly | African Union". au.int. Retrieved 16 June 2023.
^Ozili, Peterson K, Decentralised Finance and Cryptocurrency Activity in Africa (January 5, 2022). CSEF Volume 109, 2022, Available at SSRN: https://ssrn.com/abstract=4001707
^"AfCFTA: AFREXIMBANK to facilitate pan-African payment system with Arabs – Mediatracnet". Retrieved 19 November 2023.
^"Pan-African Payment and Settlement System". International Trade Administration. Retrieved 19 November 2023.
african, payment, settlement, system, this, article, needs, additional, citations, verification, please, help, improve, this, article, adding, citations, reliable, sources, unsourced, material, challenged, removed, find, sources, news, newspapers, books, schol. This article needs additional citations for verification Please help improve this article by adding citations to reliable sources Unsourced material may be challenged and removed Find sources Pan African Payment and Settlement System news newspapers books scholar JSTOR June 2023 Learn how and when to remove this template message The Pan African Payment and Settlement System PAPSS is a Pan African real time gross settlement RTGS infrastructure for cross border payments in distinct local currencies It was publicly launched on January 13 2022 1 by the African Union AU and the African Export Import Bank Afreximbank to compliment trading under the African Continental Free Trade Area AfCFTA Contents 1 History of PAPSS 2 How It Works 3 Central Banks 4 See also 5 ReferencesHistory of PAPSS editPAPSS was first mentioned on the 7 July 2019 2 at the 12th Extraordinary Session of The African Union Assembly in Niamey Niger to support the launch of the operational phase of AfCFTA 3 It started as a pilot project among the 6 countries in the West African Monetary Zone WAMZ before it became publicly available 2 How It Works editHere is a simplified overview of how PAPSS works 4 A company issues a payment instrument to their local bank or payment service provider The payment instruction is sent to PAPSS through the country s central bank and routes it to the beneficiary bank account PAPSS performs all validation checks on payment instruction before it sends it forwards it to the beneficiary s central bank and eventually to the local bank account PAPSS sends credit or debit settlement instruction to the Central Bank of the originator and the Central Bank of the beneficiary The Central Banks settle the transaction in hard currency using Afreximbank as the settlement agent Once the cross border net settlement is complete the beneficiary receives the funds in their local currency 5 On a daily basis PAPSS settles the balance of all of the transactions among individual African currencies netting them out prior to midnight Central Banks then resolve the remaining difference The payments and settlement process starts again from net zero the next day 6 Central Banks editThese are the banks enrolled in PAPSS December 2023 7 Bank of Ghana Central Bank of Nigeria Central Bank of Liberia Banque Central De La Republique De Guinee Bank of Sierra Leone Reserve Bank of Zimbabwe Central Bank of Djibouti Bank of Zambia Central Bank of Kenya Central Bank of The GambiaSee also editSociety for Worldwide Interbank Financial Telecommunications Swift Real time gross settlementReferences edit Ifeanyi Ubah Jeremiah 14 January 2022 PAPSS officially launched to aid payment transaction across Africa Nairametrics Retrieved 16 June 2023 a b Santosdiaz Richie 25 June 2022 Overview of The Pan African Payment and Settlement System PAPSS The Fintech Times Retrieved 16 June 2023 Decisions of the 12th Extraordinary Session of the Assembly African Union au int Retrieved 16 June 2023 Ozili Peterson K Decentralised Finance and Cryptocurrency Activity in Africa January 5 2022 CSEF Volume 109 2022 Available at SSRN https ssrn com abstract 4001707 AfCFTA AFREXIMBANK to facilitate pan African payment system with Arabs Mediatracnet Retrieved 19 November 2023 Pan African Payment and Settlement System International Trade Administration Retrieved 19 November 2023 Network PAPSS Retrieved 7 December 2023 Retrieved from https en wikipedia org w index php title Pan African Payment and Settlement System amp oldid 1188697187, wikipedia, wiki, book, books, library,
