Africa is quietly rewriting the rules of international finance. In a bold move toward economic independence, 15 African nations have embraced the Pan-African Payments and Settlements System (PAPSS)—a homegrown digital infrastructure enabling cross-border trade in local currencies, bypassing the U.S. dollar entirely. This shift, inspired by the BRICS bloc's vision of a multipolar financial world, marks a pivotal moment in the global de-dollarization movement.
PAPSS isn't just a payment platform; it's a strategic reimagining of how African economies interact. By cutting out costly foreign exchange intermediaries and reducing reliance on Western-dominated financial rails, African countries are reclaiming control over their monetary sovereignty.
The Rise of PAPSS: Africa’s Financial Backbone
The Pan-African Payments and Settlements System was designed to solve a long-standing problem: the inefficiency and high cost of intra-African trade settlements. Historically, even when two African nations traded goods, transactions often had to be routed through the U.S. dollar due to limited convertibility between local currencies. This added layers of fees, delays, and dependency.
PAPSS changes that by enabling real-time gross settlement in local currencies such as the Nigerian naira, Ghanaian cedi, and South African rand. With over 150 commercial banks now connected, the system is rapidly scaling across the continent.
Key Benefits of PAPSS:
- Dramatic cost reduction: Foreign exchange fees that once ranged from 10% to 30% are now slashed to just 1%.
- Faster settlements: Transactions that used to take days now settle in real time.
- Local currency empowerment: Strengthens domestic financial systems by keeping capital within the region.
- Scalable savings: If fully adopted across Africa, PAPSS could save an estimated $5 billion annually in FX costs.
Countries like Kenya, Malawi, Tunisia, and Zambia are already leveraging PAPSS for regional trade, setting a precedent for broader continental adoption under the African Continental Free Trade Area (AfCFTA).
BRICS as a Catalyst: A Blueprint for Regional Financial Independence
The momentum behind PAPSS didn’t emerge in isolation. It’s deeply influenced by the BRICS alliance—Brazil, Russia, India, China, and South Africa—which has long advocated for reduced dependence on the U.S. dollar. As BRICS expands and explores its own multilateral payment system, it’s providing a powerful model for regional blocs worldwide.
Africa’s adoption of PAPSS mirrors BRICS’ broader mission: to build decentralized, resilient financial ecosystems that prioritize local economic needs over global hegemony.
“A trade worth $200 million in USD could cost up to 30% in FX fees. PAPSS drops that to just 1%.”
— Financial analyst observation highlighting PAPSS efficiency
This synergy between BRICS and African financial innovation signals a growing trend: nations are no longer waiting for permission to reshape the global monetary order. They’re building alternatives—now.
Why This Matters: The Global Shift Away From Dollar Dominance
For decades, the U.S. dollar has served as the world’s primary reserve and trade currency. But cracks are forming in its dominance. From BRICS’ push for a common currency to ASEAN’s local currency initiatives, more regions are asserting currency sovereignty.
PAPSS represents one of the most concrete steps yet toward a multipolar financial system, where regional networks handle trade without relying on Western intermediaries.
The Bigger Picture:
- Reduced vulnerability to U.S. monetary policy and sanctions.
- Increased reinvestment of savings into local infrastructure and development.
- Stronger intra-regional trade, fostering economic integration across Africa.
- Inspiration for other Global South nations seeking financial autonomy.
As more countries adopt systems like PAPSS, the dollar’s role as the default trade currency will continue to erode—slowly but irreversibly.
Frequently Asked Questions (FAQ)
Q: What is PAPSS and how does it work?
A: PAPSS (Pan-African Payments and Settlements System) is a digital platform that enables real-time cross-border payments between African countries using their local currencies. It eliminates the need for third-party currencies like the U.S. dollar, reducing transaction costs and settlement times.
Q: Which countries are currently using PAPSS?
A: As of mid-2025, 15 African nations—including Kenya, Malawi, Tunisia, Zambia, Nigeria, and Ghana—are actively using PAPSS. The system is expected to expand across all AfCFTA member states in the coming years.
Q: How does PAPSS reduce foreign exchange costs?
A: By settling trades directly in local currencies, PAPSS removes intermediaries and avoids costly currency conversions. This slashes FX fees from an average of 10–30% down to just 1%.
Q: Is PAPSS similar to cryptocurrency?
A: No. PAPSS is a centralized payment infrastructure backed by central banks and commercial institutions. While it leverages digital technology, it does not use blockchain or decentralized tokens like cryptocurrencies do.
Q: Could PAPSS challenge the U.S. dollar globally?
A: While PAPSS won’t replace the dollar overnight, it’s part of a larger trend weakening dollar dominance in regional trade. Combined with similar initiatives like BRICS’ proposed currency pool, it contributes to a more balanced, multipolar financial system.
The Future of Trade: Local Currencies, Global Impact
The success of PAPSS suggests a future where trade isn’t dictated by a single global currency but facilitated through interconnected regional networks. This model prioritizes efficiency, autonomy, and economic resilience—values increasingly important in a volatile geopolitical climate.
Africa’s move is not anti-dollar; it’s pro-sovereignty. It’s about building systems that serve local economies first, rather than being subject to external financial constraints.
As digital infrastructure improves and political will strengthens, we may soon see a world where local currency settlements become the norm—not the exception.
Final Thoughts: A Quiet Revolution With Global Repercussions
What’s happening with PAPSS is more than a regional upgrade—it’s a paradigm shift. Inspired by BRICS and driven by necessity, Africa is proving that financial independence is achievable through innovation and cooperation.
This quiet revolution could become one of the most significant economic stories of the decade. As transaction costs fall and regional trade grows, Africa isn’t just integrating its economies—it’s redefining their place in the global order.
And while the world watches major geopolitical battles unfold, the real transformation may be happening behind the scenes, one local currency transaction at a time.
Core Keywords:
PAPSS, de-dollarization, BRICS, local currency trade, Pan-African Payments and Settlements System, multipolar financial system, currency sovereignty, intra-African trade