Ethiopia joins PAPSS to connect its banks to African payments
Ethiopia joined the Pan-African Payment and Settlement System, opening a route for its financial institutions to connect to cross-border payments in African currencies. The central bank and network announced membership in Addis Ababa on October 15. Banks’ technical connections, liquidity and local regulations shape the next steps toward customer services, while foreign-exchange controls remain in place.
Economics & Markets··Morning
Ethiopia opens a route into continental payments
The National Bank of Ethiopia, the country’s central bank, and the Pan-African Payment and Settlement System, PAPSS, announced Ethiopia’s membership on October 15. The announcement came during the Ethiopia Finance Forum in Addis Ababa, Ethiopia’s capital. Central bank governor Eyob Tekalign and PAPSS chief executive Mike Ogbalu III presented the decision at a joint press conference.[1], [2], [3]
The institutions said membership is intended to allow Ethiopian financial institutions to connect to the network and make cross-border payments with institutions elsewhere in Africa. Businesses and consumers carrying out transactions within the continent are the intended users. Tekalign described participation as part of Ethiopia’s effort to modernise its financial system and deepen economic links with other African economies.[1], [3]
Local-currency transfers use shared infrastructure
PAPSS was developed under the African Export-Import Bank, known as Afreximbank, the African Union and the African Continental Free Trade Area Secretariat. Afreximbank finances African trade; the continental free-trade area links participating economies. The network’s shared infrastructure allows a payment initiated in one African currency to reach a recipient in another, connecting institutions across national payment systems.[1], [2], [3]
Customers can pay and receive funds locally even when settlement between institutions still involves hard currency. Ethiopia’s existing foreign-exchange controls remain in place. Available transactions depend on banks and payment providers completing technical connections, regulatory requirements, liquidity arrangements and counterparties in the network. The membership announcement did not name the first Ethiopian banks to connect or give a starting date for customer transactions.[2], [3]
Addis Ababa will host the next payments conference
Ethiopia moved to a market-based exchange-rate system in July 2024. Its National Digital Payments Strategy for 2026–2030 also prioritises connecting domestic infrastructure with regional payment systems. The central bank oversees the national payment system and regulates banks and other financial institutions. Its responsibilities also include monetary policy and the management of foreign-exchange reserves.[1], [2]
Alongside membership, the central bank and PAPSS announced that they would co-host the PAPSS COWRY payments conference in Addis Ababa on November 26–27 at the Ethiopian Skylight Hotel. The programme includes cross-border payments, local-currency settlement, interoperability between systems, financial infrastructure, cybersecurity and links with international payment networks. The organisers also plan discussions on artificial intelligence, stablecoins and digital assets.[1], [2], [3]
