By Ogochukwu Isioma
The Central Bank of Nigeria (CBN) has directed all banks operating in the country to adopt the Pan-African Payment and Settlement System (PAPSS) and commence originating transactions under the new framework, as part of efforts to deepen intra-African trade and improve cross-border payment efficiency.
According to a statement on Monday by Mrs Hakama Sidi Ali, CBN’s Acting Director of Corporate Communication, this directive follows the apex bank’s recent review of documentation requirements for PAPSS transactions in Nigeria.
Launched in January 2022 by Afreximbank in partnership with the African Union and the African Continental Free Trade Area (AfCFTA) Secretariat, PAPSS serves as a centralized platform that enables instant, secure, and efficient cross-border transactions across Africa.
It allows for payments to be made in local currencies, thereby reducing reliance on third-party currencies like the U.S. dollar, minimizing transaction costs, and supporting the expansion of trade under the AfCFTA.
In a circular referenced TED/FEM/PUB/FPC/001/006, issued on April 28, 2025, CBN outlined key changes to the documentation requirements associated with PAPSS transactions aimed at promoting greater participation by banks, exporters, importers, and individuals.
According to the CBN, one of the key changes is the simplification of documentation for low-value transactions. “Individuals conducting transactions up to $2,000 or its naira equivalent, and corporates up to $5,000 equivalent, can now use basic Know Your Customer (KYC) and Anti-Money Laundering (AML) documents previously submitted to their Authorized Dealer Banks (ADBs),” it said.
“For transactions above these thresholds, however, all existing documentation requirements as stipulated in the CBN Foreign Exchange Manual and other circulars remain mandatory.”
The circular clarified that applicants are responsible for ensuring that all regulatory documents required for clearing goods are provided to the relevant government agencies.
In a move aimed at boosting market-driven forex sourcing, the CBN announced that Authorized Dealer Banks may now source foreign exchange for PAPSS settlements through the Nigerian Foreign Exchange Market without direct recourse to the CBN.
In addition, the CBN mandated that all export proceeds repatriated via PAPSS must be duly certified by the processing banks to ensure compliance with existing export regulations.
The apex bank, therefore, urged exporters, importers, and individuals to familiarise themselves with the revised requirements and leverage PAPSS for cross-border transactions, noting that the initiative will enhance financial inclusion and operational efficiency.