Fintech Interoperability Across African Markets: The Infrastructure Race Behind Easier Cross-Border Payments

Africa’s fintech sector is moving into a more demanding phase: connecting payment networks that were built for separate national markets. From the Pan-African Payment and Settlement System (PAPSS) to mobile-money partnerships and South Africa’s push for a more integrated national payments ecosystem, Fintech Interoperability Across African Markets is becoming central to how businesses trade, workers send money home and consumers pay across borders.

The opportunity is substantial, but so are the obstacles. Different currencies, licensing regimes, identity standards, settlement systems and consumer-protection rules still make a payment from Johannesburg to Lagos or Nairobi more complicated than a domestic transaction. Interoperability is therefore not simply a technology upgrade. It is a regulatory and commercial project involving banks, mobile-network operators, fintechs and central banks.

Fintech Interoperability Across African Markets moves from ambition to infrastructure

The continent’s most prominent shared payments initiative is PAPSS, developed by Afreximbank in collaboration with the African Union Commission and the AfCFTA Secretariat. The system is designed to support instant or near-instant cross-border payments in local currencies, reducing reliance on correspondent banking channels and foreign intermediary currencies.

PAPSS connects participating central banks, commercial banks, payment-service providers and other financial intermediaries. Its importance lies in creating a common settlement layer for trade and remittances while allowing customers and businesses to transact through familiar local institutions. The system’s stated objective is to make cross-border payments safer and more efficient as intra-African trade expands.

In 2025, PAPSS also announced the PAPSS African Currency Marketplace in partnership with Interstellar. The initiative is intended to improve access to African currencies and support liquidity for cross-border transactions. Its progress will be closely watched because currency availability and foreign-exchange settlement remain practical constraints on regional commerce.

For South African businesses, this matters well beyond financial services. Importers, exporters, online merchants, logistics companies and professional-service firms all face payment friction when serving customers or suppliers elsewhere on the continent.

Why mobile money is the test case for interoperability

Mobile money has created vast digital payment ecosystems in countries such as Kenya, Ghana, Tanzania, Uganda and Rwanda. Yet a wallet is only as useful as the people and businesses it can reach. If customers on rival networks cannot transfer funds easily, the market remains divided into closed islands.

A February 2024 GSMA study found that mobile-money providers were increasingly connecting to banks, with providers in its sample linked to an average of 18 local banks. The report also identified central-bank-operated hubs as an emerging model in several markets, including Ghana, Rwanda, Tanzania and Uganda.

Interoperability can deliver clear benefits:

• Customers can send money between different mobile-money schemes and bank accounts.
• Small businesses can accept payments from a broader customer base without maintaining multiple wallets.
• Fintechs can build services on top of shared rails instead of recreating bilateral connections.
• Remittance providers can reduce dependence on cash collection and fragmented agent networks.

However, connection alone does not guarantee adoption. Providers must agree on pricing, fraud liability, service levels and data-sharing rules. If an interoperable transaction costs more than a closed-network transfer, customers may continue using the older model.

South Africa’s domestic reforms have regional implications

South Africa has a sophisticated banking system and a growing fintech sector, but its payments market has historically been shaped by established institutions and tightly controlled access to infrastructure. The South African Reserve Bank’s payments strategy has increasingly focused on reducing fragmentation and widening participation.

The Reserve Bank’s 2024 Digital Payments Roadmap proposes that e-money should move towards interoperable offerings. It states that a customer of one remittance, e-money or mobile-money provider should be able to transact with customers of other providers. The roadmap also considers a larger role for non-bank firms in remittances, mobile money and e-money services.

That direction could influence South Africa’s regional role. Local banks and fintechs are already active in African markets, while South African consumers and companies regularly send and receive money across borders. More open domestic payment infrastructure could make it easier for local firms to connect to continental schemes such as PAPSS.

The Reserve Bank has also highlighted API harmonisation as a way to support transparent and secure cross-border payments. Common technical interfaces will not resolve every regulatory problem, but they can lower the cost and complexity of connecting systems.

Regulation, identity and settlement remain the hard problems

The technology required for interoperability is increasingly available. The more difficult work involves agreeing on rules that apply when a transaction crosses jurisdictions.

Regulators must coordinate on anti-money-laundering requirements, know-your-customer checks, sanctions screening, licensing and dispute resolution. A customer may be verified under one country’s rules but still require additional checks before using a service in another market.

Currency settlement is another constraint. A payment can be technically instant while the underlying foreign-exchange conversion remains slow or expensive. Local-currency settlement, shared liquidity mechanisms and transparent exchange rates are therefore as important as application programming interfaces.

Consumer protection must keep pace as well. When a cross-border payment fails, responsibility can be unclear: the customer may deal with a wallet provider, a bank, a switch or an intermediary. Effective interoperability requires visible complaint channels and clear rules on reversals, fraud and unauthorised transactions.

Businesses are looking beyond bilateral connections

Until recently, many fintechs expanded across Africa by negotiating separate integrations with banks, mobile operators and payment processors in each country. That approach can work at small scale, but maintenance becomes costly as the number of markets increases.

Shared infrastructure offers a different model. A fintech may connect once to a regional or continental rail, subject to eligibility and local regulation, and then reach a wider network of participants. PAPSS describes both direct and indirect participation for banks, fintech companies and payment-service providers.

For businesses, the practical gains could include:

• Faster supplier payments and improved cash-flow visibility.
• Lower dependence on correspondent banking relationships.
• More consistent reconciliation across currencies and providers.
• Greater reach for African online merchants and software platforms.

Still, firms should not assume that a pan-African connection eliminates country-level obligations. Licensing, tax reporting, data protection and consumer rules remain national or regional responsibilities. Interoperability expands reach; it does not remove compliance.

The next phase will be measured by everyday use

The success of Fintech Interoperability Across African Markets will ultimately be judged by ordinary transactions rather than infrastructure announcements. A trader in Gauteng should be able to pay a supplier in another African market without navigating opaque fees. A migrant worker should be able to send money home through a regulated digital channel. A small retailer should not need a separate device or wallet for every customer network.

Achieving that outcome will require sustained cooperation between central banks, operators and private companies. It will also require transparent pricing and reliable uptime, particularly in markets where consumers rely on mobile payments as a primary financial service.

PAPSS provides a continental backbone, while domestic reforms and mobile-money interoperability projects address the last-mile realities of African payments. Their progress will determine whether the continent’s fintech market remains a collection of national successes or develops into a genuinely connected commercial network.

Over the next few years, the strongest signal will be whether interoperability becomes invisible to users: payments that work across borders, settle in understandable terms and carry protections that customers can trust. That is the standard African fintech infrastructure will increasingly be expected to meet.