State of cross-border payments in Africa

The African payments eco-system is buzzing despite some countries still having challenges with regulation and internet infrastructure. CNBC Africa’s Tabitha Muthoni spoke to Kevin Ng’ang’a, Country Director, Verto for more on the inherent opportunities in the payments space in Africa and how this can accelerate trade. When it comes to the state of cross-border payments in Africa, there are still significant challenges within the continent's cross-border payments infrastructure, mainly driven by regulatory issues. Different jurisdictions have varying levels of regulatory requirements for cross-border payments, leading to inconsistencies in the system. Moreover, technology disparities exist across Africa, with some regions having advanced technological infrastructure for cross-border payments while others are lagging behind. These obstacles pose challenges for seamless and efficient cross-border transactions within the continent. Despite these challenges, there are inherent opportunities for growth and development in the African cross-border payments landscape. Central banks are increasingly focusing on Africa, driven by initiatives like the Africa Free Continental Trade Agreement aimed at facilitating easier cross-border transactions. This shift in focus opens up new possibilities for enhancing cross-border payment systems within Africa and with global counterparts. Verto, with its focus on VATOFX strength, aims to excel in business-to-business cross-border payments within Africa. The company is committed to connecting African businesses globally, facilitating seamless pay-ins and pay-outs to and from the rest of the world. By leveraging a global banking network, Verto ensures swift payments in over 190 markets and 50 currencies within 24 hours, addressing a significant challenge faced by African businesses. Additionally, Verto helps businesses collect payments globally in real-time, enhancing efficiency and liquidity management. Technology plays a crucial role in shaping Africa's cross-border payment landscape. The emergence of API connectivity and investments in payment infrastructure have revolutionized payment systems. Companies like Verto are enabling customers to create beneficiaries, receive funds, and make payments directly from their enterprise resource programs, streamlining processes and driving efficiency. This technological advancement allows businesses to focus on core activities such as market expansion, fostering growth and connectivity. With a strategic approach to compliance and regulatory adherence, Verto navigates the diverse regulatory environments for cross-border payments across different African countries. It is regulated in multiple jurisdictions, ensuring high anti-money laundering and compliance standards to monitor transaction flows effectively. Before entering new markets, Verto thoroughly assesses regulatory requirements and collaborates with regulators to ensure full compliance with local laws. Looking ahead, Verto aims to achieve significant growth in intra-Africa cross-border payments, targeting 100% year-on-year growth and processing over $10 billion in transactional volume within the next three to five years. By fostering innovation, compliance, and technological advancement, Verto is set to play a pivotal role in shaping the future of cross-border payments in Africa.