Pesalink and PAPSS Unlock Cross-Border Payments in Local Currencies in Kenya

WHY THIS MATTERS:
Cross-border payments within Africa remain slow and expensive, often relying on correspondent banking networks and foreign reserve currencies. With remittance costs averaging 7–8% and settlement times stretching up to a week, inefficiencies directly impact SMEs, traders and families. The Pesalink–PAPSS partnership tackles this friction by enabling instant, 24/7 cross-border payments settled in local currencies — a significant step toward reducing cost, complexity and currency dependency.

By connecting over 80 Kenyan financial institutions on Pesalink to more than 160 banks and fintechs on PAPSS, the integration strengthens the payment rails underpinning the African Continental Free Trade Area (AfCFTA). Local-currency settlement also helps mitigate FX exposure and preserves liquidity within African markets, supporting broader financial integration objectives.

Pesalink, Kenya’s de facto instant payment network, has partnered with the Pan-African Payment and Settlement System (PAPSS) to ease cross-border payment and speed up regional financial integration.

The partnership enables instant 24/7 cross-border payments from PAPSS participants into banks and mobile money operators within the Pesalink network in Kenya, all settled in local currencies. This reduces complex correspondent banking requirements and reliance on foreign reserve currencies. 

PAPSS, an initiative of the African Export-Import Bank (Afreximbank) in collaboration with the African Union and the AfCFTA Secretariat, enables cross-border payments between African countries. Pesalink is now a Technical Connectivity Provider. It means that 80 plus Kenyan bank, fintech, SACCO and telco participants on the Pesalink network will be connected to 160 plus commercial banks and fintechs on the PAPSS platform. 

Cross-border payments remain expensive and slow for many African businesses. The 2023 World Bank Remittance Prices report indicates that sending money across African borders incurs on average 7-8% of the total value sent (above the global average of 6–7%). Settlement can also take three to seven business days. 

The Pesalink–PAPSS partnership will reduce costs, speed up settlements, and help individuals, SMEs and businesses send money more efficiently across borders. 

Speaking during the partnership signing held at Pesalink offices in Nairobi, PAPSS CEO Mike Ogbalu III said, “For PAPSS to deliver true impact, collaboration with national and private switches like Pesalink is essential. Pesalink is the first switch we’ve piloted for transaction termination in Kenya, and we are already seeing greater adoption by opening more channels for seamless, local-currency cross-border payments across Africa.”

Pesalink CEO, Gituku Kirika, said “Kenyan banks will now be able to offer faster, cheaper cross-border payments. They will be helping their customers grow more regional trading relationships and thrive in a more integrated digital economy.”

FF NEWS TAKE:
Regional trade cannot scale efficiently without modern payment infrastructure. This partnership signals a practical move from policy ambition to operational connectivity.

If adoption accelerates, integrations like this could materially lower intra-African transaction costs and reduce reliance on dollar-clearing systems. The long-term prize is a more self-sustaining, digitally connected African payments ecosystem — and this looks like a foundational building block.