APA-Addis Ababa (Ethiopia) Africa sees sustained growth in the supply of instant payment systems and demand for their functionality, the second edition of the annual State of Inclusive Instant Payment System (SIIPS) in Africa report has revealed
The report, which was released on Wednesday through the United Nations Economic Commission for Africa (UNECA) said the achievement shows Africa’s strong progress toward the aspirational goal of having comprehensive and inclusive instant payment systems as part of Africa’s Digital Public Infrastructure (DPI), creating a seamless digital ecosystem for people, businesses, and governments.
The report, which was jointly produced with the United Nations Economic Commission for Africa (UNECA) and the World Bank, was released by AfricaNenda.
The SIIPS report was first launched by AfricaNenda in October 2022 to inform public and private sector stakeholders on the developments of instant payment system (IPS) in Africa, including an assessment of the inclusiveness of such systems, with consumer insights and case studies.
This year’s SIIPS edition highlighted developments in the IPS landscape and includes a spotlight on cross border retail payments’ policy and regulatory harmonization in Africa.
According to the report, three new instant payments systems that have been launched in Ethiopia, Morocco, and South Africa in the last twelve months have brought the total number of live domestic and regional instant payment systems on the continent to 32 even though they were not all inclusive.
“The volume of payments and the total value of payments processed have grown rapidly since 2018, by 47 percent and 39 percent, respectively. IPS in Africa facilitated nearly 32 billion transactions valued at approximately $1.2 trillion in 2022,” the report said.
The report indicated that so far, only nine countries in Africa have access to a progressed Inclusive Instant Payment System IIPS through 3 domestic systems in Ghana, Malawi and Zambia and one regional system GIMACPAY in the Economic and Monetary Community of Central Africa (CEMAC).
“The remarkable growth of instant payment systems in Africa since last year is a testament to our collective commitment to driving positive change in the continent,” the report quoted Robert Ochola, CEO of AfricaNenda as saying.
“AfricaNenda is working to ensure that Inclusive Instant Payment Systems become a driving force for economic prosperity for Africans. SIIPS 2023 shows that together, we’re shaping a future where digital financial inclusion knows no bounds.” Ochola has said.
However, the report indicated that there are still challenges in bringing inclusive instant payment system ecosystem in Africa.
“To date, most of the live IPS are either not ranked, due to lack of publicly available IPS data and information, or have reached only a basic level of inclusiveness, meaning the IPS offers minimal channel functionality and only person-to-person and person-to-business transactions are supported,” the report noted.
The report further said twenty-seven countries have yet to set up a domestic instant payment system, although seventeen have plans on the way and three regional payment systems are also on progress across the continent.
“The second edition of the SIIPS report underscored significant advancement in digital payments adoption, playing pivotal milestone for the effective realization of AfCFTA’s objectives,” the report said
The report noted that there is a need to address the exigent requirement for establishment of trusted authentication systems that can work seamlessly across the continent through interoperable digital ID systems.
MG/abj/APA