Introduction

Africa is one of the world’s fastest-growing economic regions, but trade across the continent for a long time remained fragmented and inefficient. This should naturally sound strange to anyone; because a continent home to some of the world’s largest deposits of raw materials, including agricultural produce, tin, crude oil, and other natural resources should trade with each other.

For decades, experts and policymakers called for a unified trade agreement that would connect African markets, boost regional commerce, and allow the continent to harness its full economic potential, but nothing happened.

If European countries have long-established routes to purchase Africa’s natural resources, despite the complex logistics haul, one would assume African nations have better trading relationships, but that hasn’t been the case.

Why? Many reasons, one of them being that Africa’s internal systems are simply not optimised for cross-border trade.

As the 21st century ushered in the IT boom and digital commerce expanded, African nations realised the need to rewrite their story, and on their own terms. Intra-African trade needed to flourish to unlock a new phase of development; internal cohesion was a must, and a unified customs and tariff agreement had to be put in place.

One of the most ambitious steps toward that goal was the creation of the African Continental Free Trade Area (AfCFTA), a framework designed to foster deeper economic integration and improve trade efficiency within Africa.

The AfCFTA would further create a single market for goods and services across the continent, boost intra-African trade by eliminating tariffs on up to 90% of goods and enabling the free movement of business travellers, capital, and investments.

The agreement, signed by 54 of Africa’s 55 countries, officially began operations in January 2021. While it has made visible progress, success is still far off, largely because of the persistent challenges in B2B Payments to the continent and other emerging market.

AfCFTA’s Vision and the B2B Payment Paradox

In simple terms, the AfCFTA aims to establish a single market for goods and services, enabling the free movement of Africa’s over 1.3 billion people, to deepen the continent’s economic integration in line with the Pan-African Vision of “an integrated, prosperous, and peaceful Africa” outlined in the African Union’s Agenda 2063.

At its core, the AfCFTA policy initiative was created to significantly boost intra-African trade, which currently sits at about 14.9% (2023), a stark contrast to Europe’s 62%.

When the AfCFTA successfully eliminates these tariffs and reduces other non-tariff barriers such as customs delays and regulatory bottlenecks, the agreement could significantly increase cross-border payments in  Africa within the next decade.

Beyond trade numbers, if implemented well, the AfCFTA will lift over 30 million Africans out of extreme poverty by 2035 (World Bank), create millions of jobs, especially for women and the youth population, and promote inclusive, sustainable growth. It will also strengthen Africa’s collective bargaining power on the international stage, positioning the continent as an emerging market shaping its own economic future.

Despite the promise, turning the AfCFTA vision into reality has not been easy. For the agreement to truly thrive, intra-African trade needs seamless B2B cross-border payments and settlements.

However, many cross-border transactions are still settled outside the continent through global currencies like the U.S. dollars or euros, even when the trade is between neighbouring countries.

This paradox of unified trade ambitions but disconnected financial systems remains a key obstacle slowing progress and limiting the AfCFTA’s full impact.

The Realities of B2B Payments in Africa

Imagine a Nigerian business owner wants to pay his South African supplier. The payment would likely pass through the SWIFT network or a correspondent banking system, which often takes several days, involves multiple intermediaries, and racks up significant fees for both parties.

For most business transactions, B2B payments to emerging markets are not challenges. Individual banks in each country would route transfers to their partner institutions outside Africa, which would then forward the money to another intermediary bank, which would then credit the receiving African bank.

While large corporations may work around these inefficiencies, small and medium-sized businesses cannot, and that’s a bigger problem.

SMEs drive local economies, create jobs, and hold the potential to become Africa’s next unicorns; however, B2B settlement challenges, like limited access to foreign exchange and the lack of seamless cross-border payment systems, continue to hinder their growth across the continent.

Many of these businesses often resort to finding demand outside Africa, and using the existing, lacking channels to meet their payment obligations, usually at unfavourable rates or in insufficient volumes, causing fragmented liquidity.

The result?  Stifled growth, strained operations, and inefficient treasury management.

But this is changing.

Private innovators have, in the last decade, created payment and B2B settlement solutions that have redefined and are still redefining how payments are now done on the continent.

​But how have these fintechs shaped the AfCFTA era, and how are businesses navigating payments under this new framework?

The Rise of Fintechs, PAPSS and Stablecoin Payment Integrations.

How can African businesses enjoy better cross-border trade if they can’t settle seamlessly? Only one way! Africans must make African B2B payments better.

Africans understood that African problems required African solutions, and when policymakers were slow to respond, individual brilliance had to step in, and individual brilliance did step in.

Even before the AfCFTA framework was created in 2018, the continent had experienced a surge of fintech innovation focused on simplifying payments and expanding financial inclusion.

Since the AfCFTA trading began in 2021, Africa’s intra-national financial settlement infrastructure has improved, thanks to fintechs that have stepped in to close the gaps, creating faster, cheaper, and more inclusive payment rails for cross-border commerce.

Blockchain technology and stablecoins are new entries into this movement, and are now increasingly integrated into cross-border payment solutions, offering new ways to enable faster, cheaper, and more transparent cross-border transactions.

For instance, fintechs like Ledig uses stablecoins, a technology built on the blockchain, to facilitate payments for businesses and do remittances across many markets in Africa and other emerging markets.

These and others have opened doors for businesses that once struggled with inefficient B2B payment systems.

At the same time, policymakers have made their own move with the launch of the Pan-African Payment and Settlement System (PAPSS), a government-backed initiative designed to enable fast, cross-border transactions in local currencies across member nations.

With stablecoin-powered cross-border payments now helping reduce reliance on traditional rails and PAPSS offering public-sector infrastructure to support the AfCFTA’s vision of a unified market, the pathway for more streamlined cross-border B2B settlements across the continent has gotten clearer.

Conclusion

Trade agreements alone will not unlock Africa’s trade potential. The AfCFTA provides the framework, but how well businesses navigate B2B payments will determine its success.

As fintech innovators, regulators, and financial institutions continue to align, the dream of a truly borderless African market is taking form. Faster, transparent, and reliable B2B payments are also taking shape, enabling more businesses to trade freely, scale efficiently, and compete globally.

Seamless B2B payments are, in reality, only the first step. To fully realise the AfCFTA’s vision, policymakers must also streamline commodity logistics, harmonise customs procedures, and build and adequately maintain road and rail infrastructure linking major trade hubs.

When these systems converge, trading in Africa will be more seamless, and the continent’s $29 trillion economic projection may just well become reality.