Across Africa, a quiet revolution is reshaping how countries do business with one another. Instead of relying on the US dollar to settle trade—even with their next-door neighbors—more and more African nations are choosing to trade in their own local currencies. At the heart of this shift is the Pan-African Payments and Settlement System (PAPSS)—a fast-growing platform that’s changing the face of intra-African trade.
And while this might sound like a bureaucratic development, it’s anything but. For many African businesses, this could mean saving billions, improving access, and finally reducing the costs that have made trade on the continent 50% more expensive than the global average. But not everyone is thrilled. Former US President Donald Trump has already issued fiery warnings, interpreting the move as a threat to the dollar’s global dominance.
PAPSS was never about politics, insists its CEO, Mike Ogbalu. “This isn’t about ‘de-dollarising’ the world. It’s about survival and efficiency,” he said. Currently, if a Kenyan company wants to buy goods from Nigeria, both parties often have to convert their currencies into dollars first—paying extra fees to international banks along the way. That process isn’t just frustrating; it’s expensive and unnecessary.
In fact, PAPSS estimates that using dollars for African trade can add up to 30% in extra costs for a single $200 million transaction. With local currency settlement? That cost drops to around 1%.
Now with 150 banks across 15 African countries on board, from Tunisia to Zambia, PAPSS is gaining serious ground.
But the system’s growth has caught the attention—and the ire—of Donald Trump, who’s made no secret of his displeasure. When the BRICS nations (which includes South Africa and Egypt) floated the idea of a shared currency earlier this year, Trump fired off a warning on his Truth Social platform:
“Any country that tries should say hello to tariffs, and goodbye to America!”
For Africa, however, this isn’t about geopolitics—it’s about basic economic freedom. Ogbalu and others are firm: Africa simply can’t afford to keep playing by rules that don’t work in its favour.
Even the World Bank’s IFC is throwing support behind this shift by offering loans in local currencies. “Hard currency loans to local businesses can be crippling,” said Ethiopis Tafara, IFC’s VP for Africa. “We’re trying to change that.”
This push has found a global platform, thanks to South Africa’s current leadership of the G20. At a recent summit, Lesetja Kganyago, Governor of the South African Reserve Bank, didn’t mince words:
“Some of the most expensive corridors for cross-border payments are on our continent. We need to fix that—by using our own currencies.”
With another G20 meeting scheduled for July, African leaders are expected to push harder for support—and recognition—for their homegrown solution to a long-standing problem.
Whether it’s viewed as a financial necessity or a political move, one thing is clear: Africa is taking charge of its economic future. Countries are no longer willing to pay the high price—literally—of dependency on foreign currencies just to trade with each other.
And as PAPSS continues to grow, the message from African capitals is growing louder: It’s not about leaving the global system—it’s about building a system that works for Africa.
Trump’s threats or not, this is a path African nations seem determined to walk—one local currency at a time.
