How Instant Payment Networks Are Changing Cross-Border Payments in Africa

From fragmented financial systems to faster, more connected regional commerce

Africa's international payments landscape is entering a new phase. For decades, moving money between African countries could be more complicated than sending funds to financial centers outside the continent. Transactions often depended on multiple intermediaries, foreign currencies and settlement processes that added time and cost.

Today, instant payment networks are beginning to change that structure. Domestic payment systems are expanding, regional networks are becoming more interconnected, and financial institutions are developing new ways to move value between African markets.

The transformation is not simply about making transactions faster. It is about changing how African financial systems interact with one another.

According to the AfricaNenda Foundation's State of Inclusive Instant Payment Systems in Africa 2025 report, the continent had 33 domestic instant payment systems operating across 25 countries as of June 2025, alongside three regional systems. This expanding network of domestic and regional payment capabilities is creating new opportunities for financial inclusion, digital commerce and international business. (Central Bank Payments News)

However, the next challenge is more complex than launching additional instant payment systems. Africa needs to connect them effectively across national boundaries, currencies and regulatory environments.

The future of African international payments will increasingly depend on how well domestic payment networks can work together.

Why Traditional International Payments Have Been Complicated

International payments involve more than transferring information between two financial institutions. They require coordination between banking systems, currencies, settlement arrangements and regulatory frameworks.

Historically, a business sending money from one African country to another could encounter several intermediaries before the transaction reached its destination. In some cases, payments were routed through international correspondent banking networks and converted into major foreign currencies before being converted again into the recipient's currency.

This structure could create unnecessary complexity, particularly when the two countries involved were geographically close but lacked direct financial connectivity.

For businesses, these inefficiencies translate into operational challenges. Suppliers may wait longer to receive funds, merchants may experience uncertainty around settlement, and finance teams may struggle to predict when money will become available.

The problem is especially significant for small and medium-sized businesses, which often have fewer financial resources to absorb delays or maintain large liquidity buffers.

Instant payment networks offer an opportunity to improve this model by creating faster and more direct connections between financial institutions and payment ecosystems.

The Rise of Instant Payment Systems Across Africa

Instant payment systems allow eligible transactions to be processed and funds to become available to recipients within seconds or minutes, depending on the network's design.

Unlike traditional banking processes that may depend on limited operating hours or delayed processing cycles, many instant payment systems are designed to operate continuously.

Their expansion reflects a broader shift in African financial infrastructure. Countries are increasingly investing in domestic payment capabilities that can support digital commerce, improve access to financial services and reduce dependence on cash.

The AfricaNenda Foundation's 2025 research identified five new domestic instant payment systems launched between July 2024 and June 2025, in Algeria, Eswatini, Libya, Sierra Leone and Somalia. These developments brought the number of domestic systems to 33 across 25 countries. (AfricaNenda Foundation)

The significance of this growth extends beyond domestic transactions. As more countries establish instant payment capabilities, the potential foundation for regional connectivity becomes stronger.

A country with a functioning domestic instant payment network already has part of the infrastructure required to support faster international payment arrangements. The next step is connecting that infrastructure with compatible systems in other markets.

From Domestic Instant Payments to Regional Connectivity

A domestic instant payment system solves an important problem: moving money efficiently within one financial market.

International payments introduce additional requirements. Financial institutions must coordinate across jurisdictions, exchange transaction information, manage currencies and comply with different regulatory obligations.

Connecting two domestic networks therefore requires more than establishing a technical API connection.

The systems need compatible transaction messaging, participant identification, settlement arrangements and operational rules. They also need mechanisms for handling compliance checks, failed transactions and disputes.

When these components work together, domestic payment networks can become building blocks for regional financial connectivity.

This represents an important architectural shift. Instead of creating one universal payment method for every African country, regional systems can connect existing national payment environments.

Local payment infrastructure remains relevant, while international connectivity becomes more efficient.

PAPSS and the Development of Pan-African Payments

One of the most significant developments in this area is the Pan-African Payment and Settlement System (PAPSS).

Developed through an African-led initiative involving Afreximbank, the African Union's continental trade agenda and participating central banks, PAPSS aims to facilitate payments between African countries while reducing reliance on traditional international settlement arrangements.

Its model supports payments initiated and received in local currencies, with participating financial institutions connected through a common regional framework.

According to PAPSS, its processes combine near-instant payment messaging, prefunding arrangements and net settlement. Eligible payments can be processed within approximately 120 seconds, while underlying financial obligations are managed through the system's settlement arrangements. (PAPSS)

This distinction matters because instant payment processing and final settlement are not necessarily the same event.

A beneficiary may receive funds quickly while the financial institutions involved settle their obligations according to the network's established procedures.

The broader significance of PAPSS is its attempt to connect African financial markets without requiring every country to abandon its existing payment infrastructure.

Kenya Demonstrates How Regional Connectivity Is Expanding

A notable example emerged in February 2026, when Kenya's Pesalink network announced a partnership with PAPSS.

The arrangement was designed to enable instant, 24/7 international payments from PAPSS participants into banks and mobile money operators connected to Pesalink in Kenya, with transactions supported in local currencies.

At the time of the announcement, Pesalink reported more than 80 participating institutions, while PAPSS had more than 160 participating banks across its network. (afreximbank.com)

The importance of this development lies in the connection between domestic and regional financial systems.

Rather than requiring every bank or merchant to establish entirely separate international relationships, existing domestic payment connectivity can become accessible through a broader network.

It illustrates how Africa's instant payment ecosystem may evolve: national systems maintain their domestic functions while becoming increasingly connected to regional payment arrangements.

Central Africa Is Becoming Part of the Conversation

Regional connectivity is also expanding beyond markets that have traditionally received the most fintech attention.

In July 2026, the Bank of Central African States (BEAC), which serves the Central African Economic and Monetary Community (CEMAC), joined PAPSS.

The development marked another step toward connecting Central African financial systems with the wider continental payment ecosystem. (PAPSS)

However, participation in a regional payment framework does not automatically mean that every bank, wallet or merchant in the region can immediately access every international payment corridor.

Practical connectivity depends on participating institutions, operational readiness, regulatory arrangements and the specific services available.

The distinction between network participation and fully operational market access remains important as African instant payment systems expand.

Local Currency Payments Could Change Regional Trade

One of the most important potential benefits of regional instant payment connectivity is the ability to support transactions in local currencies.

Traditional international payments can involve conversion into a widely used foreign currency before funds reach their final destination.

This can introduce additional FX costs, intermediaries and settlement requirements.

Regional payment arrangements that support local-currency transactions may reduce some of these inefficiencies, depending on the currencies, participants and corridor involved.

For African businesses trading with neighboring markets, this could improve the economics of regional commerce.

A company purchasing goods from a supplier in another African country may benefit from a payment process that is easier to understand, faster to execute and less dependent on unnecessary currency conversions.

However, local-currency payments do not eliminate FX requirements entirely. Financial institutions still need mechanisms for valuing, exchanging and settling obligations between different currencies.

The innovation is not the disappearance of currency complexity. It is the possibility of managing that complexity more efficiently.

Faster Payments Can Improve Business Cash Flow

Payment speed has consequences beyond customer convenience.

For businesses, the timing of incoming and outgoing payments affects working capital.

A merchant waiting several days for international funds may have less flexibility to purchase inventory, pay suppliers or finance operations.

Similarly, delayed supplier payments can create uncertainty throughout a commercial relationship.

Instant payment networks can reduce some of these delays by shortening the time between payment initiation and the recipient's access to funds.

This is particularly valuable for smaller businesses, where relatively modest payment delays can affect daily operations.

Faster access to money can improve liquidity management, reduce uncertainty and make regional commercial relationships easier to maintain.

The economic benefit therefore extends beyond payment processing itself.

Instant Payments Could Support African E-Commerce

Digital commerce depends on customers being able to pay and merchants being able to receive funds reliably.

As African e-commerce businesses expand internationally, payment fragmentation can become a significant obstacle.

A merchant may serve customers in several countries but encounter different banking systems, payment methods and currencies in each market.

Instant payment networks can provide additional payment options, particularly where account-to-account transactions are accessible and widely adopted.

For merchants, faster payment confirmation can potentially improve order processing and operational visibility. For customers, familiar local payment methods can make international purchases more accessible.

However, payment localization remains essential. Instant bank payments will not automatically replace cards, mobile money or other methods preferred by particular customer segments.

The most effective international payment strategies will likely combine access to instant payment networks with broader local payment-method coverage.

Mobile Money and Instant Payment Networks Are Becoming More Connected

Mobile money is a defining feature of many African financial ecosystems.

For millions of consumers and businesses, mobile wallets provide an important alternative to traditional bank-based payments.

Historically, mobile money and banking systems have not always been fully interoperable. Customers could encounter limitations when transferring funds between different providers or financial institutions.

Instant payment networks can help address this fragmentation when their participation rules and technical architecture support connections between banks and non-bank financial providers.

This creates opportunities for more inclusive payment ecosystems in which value can move between different types of financial accounts.

For international payments, the implications are particularly important.

A regional payment network connected to domestic banking and mobile money ecosystems can potentially make international transactions accessible to a wider range of users.

The objective is not to replace mobile money with bank transfers. It is to improve connectivity between the financial products people already use.

Interoperability Matters More Than One Universal Payment System

The expansion of instant payment networks reinforces an important principle: Africa does not need one identical payment system in every country to achieve stronger regional financial integration.

Different markets have developed financial infrastructure suited to local requirements.

These systems can continue operating independently while becoming more interoperable.

Interoperability allows financial networks to exchange transaction information and, where the necessary arrangements exist, transfer value between participants.

This creates a network-of-networks model in which domestic payment systems connect through regional arrangements.

For international businesses, the advantage is greater reach without requiring every customer to adopt the same payment method.

For financial institutions, it creates opportunities to extend payment services beyond domestic markets through structured connectivity.

The challenge is ensuring that interoperability extends beyond technology into settlement, regulation and operational processes.

Instant Payments Still Need Liquidity

A transaction message can move between countries in seconds. The underlying financial value still needs to be available.

This makes liquidity management essential to international instant payments.

Financial institutions need access to sufficient funds in the relevant currencies and markets to meet their payment obligations.

Depending on the network architecture, this can involve prefunding, liquidity arrangements with financial partners or other approved settlement mechanisms.

PAPSS, for example, explicitly incorporates prefunding and net settlement into its operating model. (PAPSS)

As transaction processing becomes faster, liquidity planning becomes more important because providers have less time to respond to unexpected funding requirements.

A payment network may be technically capable of processing transactions instantly, but insufficient liquidity can still create delays or operational limitations.

This is why instant payment connectivity and treasury management need to evolve together.

Regulatory Fragmentation Remains a Major Challenge

Technical interoperability does not automatically create regulatory interoperability.

African countries maintain different requirements for financial institutions, PSPs, customer verification, transaction monitoring and payment services.

A provider connected to a regional payment network may still need appropriate authorization or local arrangements to offer services in a particular jurisdiction.

This means the expansion of instant payment networks must be accompanied by regulatory cooperation.

Common technical standards can improve communication between systems, but financial institutions also need clarity around legal responsibilities, compliance obligations and supervisory arrangements.

Regional financial integration therefore requires coordination between technology providers, payment system operators, regulators and financial institutions.

The next stage of African payment development will depend not only on how quickly systems connect, but also on how effectively the regulatory frameworks surrounding them can cooperate.

Real-Time Payments Require Real-Time Risk Management

Instant payments create new operational expectations.

When transactions are processed in seconds, traditional manual review processes become harder to accommodate.

Fraud detection, transaction monitoring and payment validation increasingly need to operate within much shorter timeframes.

This makes automated risk management essential.

Financial institutions may need to evaluate transaction patterns, detect anomalies and apply relevant controls before funds become available to recipients.

The challenge is balancing speed with security.

An instant payment system that processes transactions quickly but cannot manage financial crime risks effectively may create new vulnerabilities.

As Africa's payment networks become more connected, strong risk controls will become increasingly important for maintaining trust between participating institutions.

AI Could Improve Instant Payment Operations

Artificial intelligence could help address some of the complexity created by real-time, multi-market payment environments.

AI models can analyze transaction patterns, identify unusual behavior and support payment risk assessment.

They may also help financial institutions forecast liquidity requirements, identify changes in payment performance and improve operational monitoring.

As payment networks become increasingly interoperable, structured transaction data can create additional opportunities for intelligent analysis.

Over time, AI agents could potentially assist with exception handling, payment routing and liquidity recommendations within defined permissions.

However, these capabilities depend on reliable data, appropriate governance and the ability to integrate intelligence into existing financial systems.

AI does not replace payment infrastructure. It can make connected payment environments more responsive and easier to manage.

What Instant Payment Networks Mean for PSPs

The growth of instant payment networks changes the environment in which Payment Service Providers operate.

PSPs increasingly need to support businesses that expect faster transactions, broader geographic coverage and access to locally relevant payment methods.

As domestic and regional networks expand, PSPs can play an important role in helping merchants access the payment options available through their supported markets.

This is particularly relevant for companies operating across several African countries.

A merchant generally does not want to establish separate technical relationships with every domestic instant payment system, bank and financial provider.

Instead, businesses increasingly value payment platforms that can consolidate access to different financial environments.

The PSP becomes an abstraction layer between the merchant and the underlying payment ecosystem.

Payment Localization Will Remain Essential

The growth of instant payment networks does not eliminate the need for payment localization.

Different African markets will continue to have different payment preferences.

A customer accustomed to mobile money may still prefer it over a bank-based instant payment.

Another customer may choose a card or wallet.

International merchants therefore need to support the methods most relevant to their target markets.

Instant payment networks add valuable connectivity, but they should be viewed as part of a broader payment ecosystem rather than a universal replacement for existing methods.

The most scalable approach combines local customer relevance with more unified payment operations.

Where DalaPay Fits

DalaPay is a Payment Service Provider (PSP) helping businesses simplify domestic and international payments across African markets.

For merchants expanding across Africa, different payment methods, currencies and financial environments can create significant operational complexity. As instant payment networks become more connected, businesses will increasingly need payment partners capable of helping them navigate diverse local markets.

Through a unified platform, DalaPay provides access to multiple payment methods and multi-currency payment capabilities, helping merchants manage payment operations across supported African markets without treating every country as an entirely separate payment environment.

The development of regional instant payment networks reinforces the importance of this approach. Greater interoperability across African financial systems can create new opportunities for businesses, while PSPs help make fragmented payment environments more accessible and manageable.

DalaPay is a portfolio company of Velex Investments.

The Next Stage: Connecting Africa's Payment Networks

The next phase of African payments will not be defined simply by the number of countries that launch instant payment systems.

It will depend on how effectively those systems connect.

Domestic payment networks are becoming important components of national financial infrastructure. Regional initiatives are creating mechanisms for linking those networks. PSPs and financial institutions are helping businesses access the resulting payment ecosystems.

But several challenges remain, including regulatory fragmentation, currency conversion, liquidity management, financial inclusion and operational interoperability.

The industry therefore needs to move beyond measuring connectivity alone.

A payment corridor is commercially useful only when businesses and consumers can access it reliably, affordably and within the relevant regulatory requirements.

This makes the quality of integration just as important as the number of connections.

Conclusion

Instant payment networks are changing international payments in Africa by creating new possibilities for faster transactions, stronger regional connectivity and more efficient movement of value between financial markets.

The growth of domestic instant payment systems provides an increasingly important foundation. Regional initiatives such as PAPSS demonstrate how those systems can become connected across national boundaries, while developments involving Kenya and Central Africa illustrate the continuing expansion of regional payment cooperation.

However, faster payment messaging is only part of the transformation. Effective international payments still depend on liquidity, settlement, FX, regulatory coordination and access to locally relevant financial services.

For businesses, the opportunity is significant. More connected payment networks can reduce operational friction, improve cash-flow predictability and make regional commerce easier to manage.

For PSPs, the challenge is helping merchants benefit from this growing connectivity without exposing them to unnecessary technical complexity.

Africa's payment future is not simply about making money move faster within individual countries. It is about making different financial systems work together so that commerce can move more efficiently across the continent.

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