WATCH: Pioneering cross-border payments in Africa

The payments, banking and financial services sectors are undergoing an unprecedented period of disruption and change. In an ever-evolving reality, collaboration is the key to survival...especially when we look at cross border transactions as Africa opens up via the African Continental Free Trade Area.

Unfortunately, there are still many payment corridors all over the world that face incredibly high costs and considerable delays. A recent report by the World Bank provides an example from East Africa where, in 2021, the fee for sending $200 in remittances from Tanzania to neighbouring Uganda was 23% for a Ugandan migrant: that is nearly a quarter one’s income every month just to send that money home to one’s family. It costs 13% of a transaction to remit money from SA to another country — more than double the average of the Group of 20 (G20) leading global economies, according to a 2021 World Bank report.

But barriers like these are the reality for many people. And it is not just the cost of cross-border payments. These types of payments are often also slow and not transparent — and then there’s the fact that they are not fully accessible for all. So what is being done to solve the challenges?

Business Day TV spoke to Ruhling Herbst, acting executive head  for Africa Business Development at BankservAfrica; Alastair Tempest, CEO of EFSA (E-commerce Forum of SA); and Karen Nadasen, CEO of PayU SA.