Nigeria Eases PAPSS Rules to Boost Intra-African Trade for SMEs and Entrepreneurs

The Central Bank of Nigeria (CBN) has issued a new circular that significantly reduces paperwork for cross-border transactions through the Pan-African Payment & Settlement System (PAPSS), marking a key step in advancing Nigeria’s participation in the African Continental Free Trade Area (AfCFTA).

Announced on April 28, 2025, the policy lowers documentation requirements for individuals and businesses conducting PAPSS transactions, enabling faster, more affordable, and more inclusive trade. Individuals can now transfer up to $2,000 per month, and corporates up to $5,000, with only standard Know Your Customer (KYC) and Anti-Money Laundering (AML) documentation — a move expected to reduce processing delays and widen access to intra-African markets.

The directive also authorizes Nigerian commercial banks to source foreign exchange for PAPSS payments through the open FX market, creating more flexibility for financial institutions and their customers.

PAPSS, which now spans 16 countries with 14 switches and over 150 participating banks, including 22 in Nigeria, operates as a secure, instant payment system using local currencies. The streamlined policy is expected to unlock new opportunities for Nigerian Small and Medium Enterprises (SMEs), who previously struggled with heavy documentation requirements and FX constraints.

Mike Ogbalu III, CEO of PAPSS, commented:

“Today marks a transformational milestone for Nigerian commerce and for the larger vision of African economic integration. We are grateful to the Central Bank of Nigeria for its unwavering support and vision in propelling Nigeria towards seamless intra-African payments under the AfCFTA.

“This bold policy move by the CBN will empower banks, businesses, and entrepreneurs to connect, trade, and pay more easily than ever before. The directive removes excess paperwork from a large number of transfers, empowering Nigerian businesses to participate more freely in the African Continental Free Trade Area by utilising our secure, local currency-based platform.

“We also expect Nigerian banks to begin integrating PAPSS into their digital platforms such as mobile apps and online banking, in the near future, promoting even wider adoption.

“PAPSS is at the forefront of the African advancement towards a truly borderless African economy and achieving the ultimate goal of economic self-determination. We encourage all stakeholders across the continent to follow in Nigeria’s footsteps, embrace PAPSS, and become part of the transformation that will define the way Africa does payments and accelerate the realisation of the African Continental Free Trade Area goals.”

This policy shift reinforces Nigeria’s commitment to AfCFTA and positions it as a regional leader in digital financial infrastructure. With fewer administrative burdens and enhanced banking participation, PAPSS could become the catalyst for a new era of African trade integration.