Onome Amuge
The United Bank for Africa (UBA) and the Pan-African Payment and Settlement System (PAPSS) have initiated a strategic partnership aimed at revolutionising intra-African trade through the integration of UBA’s artificial intelligence-powered chatbot, LEO.
The collaboration is set to tackle persistent challenges in cross-border payments, making transactions more secure, convenient, and affordable for millions of individuals and businesses across the continent. The initiative represents a major step towards realising the long-held goal of a unified African trade market, a vision that dates back to the early days of the Organisation of African Unity.
Speaking at a recent press conference, Oliver Alawuba, group managing director and CEO of UBA, underscored the necessity of seamless financial integration for the continent’s economic prosperity. He pointed out that despite the geographical proximity of African nations, the high cost and complexity of transactions have historically hindered trade. “Whether you’re in Burkina Faso or in Guinea or in Liberia or Cameroon, we need to do a lot more business with each other,” Alawuba stated. “And the hindrance has always been… to see how to solve the payment problem across Africa, to make it confident, to make it very secure, and also make it cheap for our people, so that they can interact with each other,” he added.
Alawuba also explained the security framework that underpins the LEO chatbot. Drawing on UBA’s extensive experience operating in multiple African countries, he assured stakeholders of the platform’s integrity, detailing the encryption and personal identification features that ensure user access and transaction security. He noted the platform’s flawless track record to date, stating that despite numerous transactions, there had been “no issue, not one issue in terms of it and all of that,” a testament to its reliability and resilience.
The LEO chatbot, which is designed for ease of use, particularly for younger demographics, operates on widely-used messaging platforms such as WhatsApp, Facebook, and Messenger. This accessibility, combined with minimal data requirements, is expected to drive high adoption rates. The partnership’s initial focus is the launch of the Ghana-Nigeria corridor via LEO, but this is merely the first phase of a broader strategy to connect Africa’s key trade corridors.
Alawuba detailed an ambitious vision for future expansion, citing key routes like the Abidjan-Ouagadougou corridor and the Mano River Corridor. “As this platform is evolving, we’ll be linking them up with those corridors so that we can easily trade with each other, confidently and in a really secure manner,” he noted.
Mike Ogbalu, CEO of PAPSS, described the partnership as a pivotal moment in the quest to accelerate intra-African trade. He highlighted UBA’s pioneering role, describing the bank as “one of the first banks to integrate into the PAPSS core.”
Ogbalu emphasised that PAPSS is the modern-day solution to a vision first articulated by the OAU in 1963. He described PAPSS as a financial market infrastructure designed to allow cross border payments in local currencies, which is in line with the highest global standards. “What we have built, even though we are African, we’re actually world-class,” he said, noting that the PAPSS infrastructure can stand alongside the best payment systems in the world. He also assured that the system’s governance is robust, with central banks leading the oversight.
Ogbalu revealed that the average transaction time from initiation to completion is just seven seconds. This speed, he argued, is a game-changer for businesses that previously had to wait days for payments to clear, a delay that often hampered inventory turnover and growth. He drew a parallel to the impact of moving from three-day check clearing to same-day clearing, noting that the shift to instant payments would have an even greater transformative effect on trade. “What PAPSS does is to bring about instant payment,” he stressed.
Another major benefit is the reduction in transaction costs. Ogbalu explained that while a typical cross-border payment between Nigeria and Ghana might have cost up to $25, the PAPSS platform has lowered this to as little as $2, with an average cost of just 0.1 per cent per transaction. This massive reduction in cost is central to the platform’s mission to make trade more affordable and to accelerate economic activity across the continent.
The partnership between UBA and PAPSS is considered a strategic move to drive user adoption by integrating payments into a convenient and familiar platform. By making the service available on channels like WhatsApp and Facebook, PAPSS aims to reach a broader audience, including the tech-savvy youth who are increasingly driving the continent’s digital economy.
Both leaders noted that regulatory frameworks are evolving to support this shift. Ogbalu highlighted new rules from the Central Bank of Nigeria (CBN) that have simplified documentation for individuals and corporates for transactions below $2,000 and $5,000, respectively. This regulatory support is considered crucial for the platform’s scalability and success.
Furthermore, PAPSS is actively exploring new technologies to enhance its services. Ogbalu revealed that the organisation is looking at a number of things in the area of stablecoins and has already launched a blockchain-based African currency marketplace. This marketplace allows companies to trade their currencies directly, aiming to reduce the continent’s dependence on foreign currencies for intra-African trade.
