Nigeria’s central bank has eased documentation requirements for cross-border transactions, making it easier for small and medium-sized enterprises (SMEs) to trade across Africa under the African Continental Free Trade Area (AfCFTA).
The move by the Central Bank of Nigeria (CBN) is expected to accelerate intra-African trade by reducing bureaucratic barriers and facilitating seamless transactions via the Pan-African Payment and Settlement System (PAPSS).
Under the new policy, individuals making payments under $2,000 and businesses processing transactions up to $5,000 per month would only need basic Know Your Customer (KYC) and Anti-Money Laundering (AML) documents.
This would make it easier for Nigerian SMEs to trade across Africa under the AfCFTA, with fewer heavy documentation barriers than ever before.
Additionally, commercial banks will now be able to source foreign exchange for PAPSS transactions through Nigeria’s Foreign Exchange market.
The changes come as PAPSS continues expanding across Africa, linking 16 countries, 14 payment switches, and more than 150 commercial banks – including 22 in Nigeria.
PAPSS chief executive Mike Ogbalu III hailed the policy as a “transformational milestone” for Nigeria’s commerce and African economic integration.
“This bold policy move by the CBN will empower banks, businesses, and entrepreneurs to connect, trade and pay more easily than ever before,” Ogbalu said.
He noted that the streamlined requirements would enhance financial inclusion and trade connectivity.
The initiative also aligns with AfCFTA’s broader goal of fostering a borderless African economy through efficient, local currency-based transactions.
JN/APA