The Central Bank of Nigeria (CBN) has implemented new measures aimed at enhancing Nigeria’s role in Africa’s cross-border trade by granting Authorized Dealer Banks direct access to foreign exchange (FX) for transactions conducted through the Pan-African Payment and Settlement System (PAPSS). This move eliminates the previous dependency on the CBN for FX sourcing, allowing for quicker, more flexible transaction settlements. The directive, issued via a circular dated April 28, 2025, takes immediate effect and forms part of CBN’s broader strategy to streamline regional trade operations.
Under the new guidelines, export proceeds processed via PAPSS must now be certified by the banks handling them to ensure regulatory oversight and transaction transparency. CBN also introduced simplified documentation for low-value payments: individuals transacting up to $2,000 and companies up to $5,000 can use previously submitted KYC and AML records. Larger transactions will still require full documentation in line with the Foreign Exchange Manual.
Additionally, the burden of regulatory compliance for goods clearance has shifted to the applicants, encouraging accountability and efficiency in trade processing. These steps are seen as efforts to empower traders, boost financial inclusion, and remove bureaucratic delays that often hamper small-scale cross-border transactions.
Launched in 2022 by Afreximbank in partnership with the African Union and the AfCFTA Secretariat, PAPSS enables payment in local currencies across African nations. CBN’s endorsement and operational changes are expected to reduce Nigeria’s reliance on foreign currencies, cut transaction costs, and support the country’s integration into the wider African Continental Free Trade Area framework.
Source: The Nation