Pan African Payment and Settlement Systems(PAPSS)

This is a central Financial Market Infrastructure (FMI) that supports payment arrangements for the purpose of expanding the international trade of African states, and to facilitate central bank’s economic and financial integration. PAPSS is currently live in the West African states Monetary Zone (WAMZ) in the following countries: Nigeria, the Gambia, Sierra Leone, Liberia, Ghana, and Guinea.
Some of the Benefits
Cheap
Easy
Fast
Seamless
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- Client submits a PAPSS application request at the branch
- Due diligence is conducted on the application form.
- IBC authorizer checks for completeness and correctness
- CBN approval is obtained for the transaction.
- Client Naira account is debited for principal and related charges.
- The beneficiary receives payment in their local currency
- Customer received notification.
- Settlement is carried out in local currency.
- Instant payment in local currencies.
- Guarantees the final settlement of the funds to the recipient participant.
- The beneficiary has immediate availability of funds.
- Removes the dependencies on third currencies and correspondent banking; facilitates intra-African trade.
- Drive the Africa Continental Free Trade Area agreement (AfCFTA) to yield growth in transactional activities (trade and payments) from corporates and retail clients.
- Reduction in costs associated with correspondent banking fees and central delays.
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How to Get It
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Transaction Process
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What you Get
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- Client submits a PAPSS application request at the branch
- Due diligence is conducted on the application form.
- IBC authorizer checks for completeness and correctness
- CBN approval is obtained for the transaction.
- Client Naira account is debited for principal and related charges.
- The beneficiary receives payment in their local currency
- Customer received notification.
- Settlement is carried out in local currency.
- Instant payment in local currencies.
- Guarantees the final settlement of the funds to the recipient participant.
- The beneficiary has immediate availability of funds.
- Removes the dependencies on third currencies and correspondent banking; facilitates intra-African trade.
- Drive the Africa Continental Free Trade Area agreement (AfCFTA) to yield growth in transactional activities (trade and payments) from corporates and retail clients.
- Reduction in costs associated with correspondent banking fees and central delays.
The payments from sending customer to beneficiary customer will be in local currencies while the intercountry settlement will be in USD between the central banks. For Nigeria, provided commercial banks complied with the provision of the CBN circular on PAPSS, the CBN will support the USD settlement.
The local currencies are not reserve currencies and therefore, the member central banks agree to use USD as the settlement currency.
Yes, for now only physical goods are being considered.
The CBN has not placed a limit for payment for eligible goods imported or exported under PAPSS.
Since CBN will settle the ultimate position in USD, it is only fair that the CBN get some visibility in the process, hence the need for prior approval.
CBN settlement will be strictly for eligible transactions whether individuals or corporates.
Yes, there will be sanctions for breaches.
While any measures towards improving trade facilitation are welcome and will be supported, PAPSS will run on the existing system or procedure or processes. No change would be made just because of PAPSS.
Yes – validation is done automatically. Yes – PAPSS will be integrated to national and regional payments systems and switches. PAPSS can support the upgrade of outdated payment systems.
Yes, for every transaction, there must be an approval. The request for approval should be per individual transaction not bulk.
Transactions are T+1 and flow through NIBSS which has a 12pm clearing session. Receipt time is 24hrs from when the transaction passes the NIBSS clearing session.
The approval is not part of the 120 seconds. The 120 seconds is the cycle for successfully initiated and approved transactions on PAPSS to be received by the beneficiary. The request for approval and CBN response should be sent via letter.
Certification will be in USD.
Import payments are restricted to goods of African origin
Turnaround time is dependent on CBN Management approval
The USD or any of the specified currencies listed in Memorandum 3 of the Foreign Exchange Manual.
The cross-rates conversion between NGN and third-party currencies will be determined by the Central banks daily and updated on the PAPSS platform. The bank will advise the prevailing cross rate daily.
The Form M for import and Form NXP for export will all be in USD or any of the specified currencies listed in Memorandum 3 of the Foreign Exchange Manual.
Account number validation of the beneficiary is part of the payment process. In addition, before initiating a transaction, an account enquiry can be carried out.
This will be subject to CBN approval. All transactions processed through PAPSS need to be approved by the CBN. The Bank will deal this