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The Central Bank of Nigeria (CBN) on Monday eased documentation requirements for low-value transactions under the Pan-African Payment and Settlement System, aiming to boost cross-border payments and intra-African trade.
It said the move is part of efforts to promote intra-African trade, financial inclusion and operational efficiency for Nigerians engaging in transactions across the continent.
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The central bank disclosed this in a press release signed by the Acting Director, Corporate Communications, Hakama Ali.
PAPSS, launched in January 2022 by Afreximbank with the African Union and AfCFTA Secretariat, is a platform that enables businesses and individuals across Africa to make instant, secure payments in local currencies. It aims to make trading within Africa faster, cheaper and simpler by removing the need for third-party currencies, supporting the African Continental Free Trade Area’s goal of creating a single African market.
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In a circular referenced TED/FEM/PUB/FPC/001/006, the CBN said individuals and corporates making PAPSS transactions of up to $2,000 and $5,000 respectively can now use existing KYC and AML documents provided to their banks. Higher-value transactions will still require full documentation under the existing foreign exchange rules.
“All documentation as stipulated in the CBN Foreign Exchange Manual and related circulars remain mandatory,” the CBN said.
The new guidelines also allow authorised dealer banks to source foreign exchange for PAPSS settlements from the Nigerian foreign exchange market without seeking CBN approval.
Applicants are now responsible for ensuring all regulatory documents are available for the clearance of goods by government agencies.
ALSO READ: Breaking free of the dollar: PAPSS and intra-African trade, By Odewale Abayomi
“All export proceeds repatriated via PAPSS shall be certified by the relevant processing banks,” the CBN said.
The bank urged authorised dealers to adopt PAPSS fully and encouraged exporters, importers and individuals to “familiarise themselves with the new requirements and leverage PAPSS for cross-border transactions within Africa.”
The CBN’s new move will cut transaction costs, ease cross-border trade, and strengthen Nigeria’s role in intra-African commerce.
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