African Export-Import Bank (Afreximbank) yesterday announced the commercial launch of the Afreximbank Trade Payment Services (AfPAY), an intervention created to make it easier for specific African financial institutions and their clients to settle international trade on open account conditions.
Afreximbank developed the product precisely to address the financial issues African economies are currently facing as a result of numerous foreign banks leaving the continent, according to a statement.
Financial institutions on the continent have suffered over time due to a decrease in their access to services provided by international correspondent banks that support their international trade.
Due to the reduction in trade lines, African financial institutions’ doors were practically shut to the rest of the world. The main engine of growth is trade, thus if banks are unable to engage in trade transactions, our economy would grow less and poverty will rise.
Across our member states, AfPAY, which has been in a pilot phase for more than a year, presently facilitates monthly payments totalling more than $500 million. A notable participant in the pilot was Zimbabwe, which used the solution in 20 of its financial institutions, the announcement said.
Mr Denys Denya, Executive Vice President of Finance & Administration at Afreximbank, commented on the launch: “African banks have, for at least a generation, been dogged by the limited access to dependable banking partners willing to support their cross-border trade transactions.
“We are pleased to introduce into the market a product which transforms this dynamic, which we believe will accelerate cross-border trade on this continent, connecting Africa with an international financial eco-system that will accelerate its development and economic growth.”
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