CBN’s PAPSS May Open a New Chapter for Nigeria’s Economy -By Iswell Emmanuel

Every thriving economy has an invisible heartbeat. It is not found in towering skyscrapers, oil wells, glittering markets or busy seaports. It is found in the ease with which money moves. A random Nigerian trader may produce the finest fabric, a software developer may build world class applications, and a farmer may harvest tonnes of premium cocoa, yet all that effort can be trapped by one stubborn obstacle: inter-country payments. When businesses struggle to receive money from customers across borders, growth is slowed before it even begins. It is against this background that the Central Bank of Nigeria’s renewed commitment to the Pan African Payment and Settlement System, known as PAPSS, deserves serious attention. Far beyond another policy announcement, it represents a practical attempt to remove one of the oldest barriers standing between Nigerian businesses and the rest of Africa.

For years, African businesses have traded with one another through a route that made little economic sense. A Nigerian company selling goods to Ghana or Kenya often had to convert naira into United States dollars before the payment could be completed. With that, time was lost, additional charges were imposed, and exchange rate risks became unavoidable. The seller earned less, while the buyer paid more. Many promising small businesses simply abandoned opportunities outside Nigeria because the process was too expensive and unnecessarily complicated. Trade was not being discouraged by a lack of demand. It was being restrained by an outdated payment architecture that treated neighbouring African countries as though they were continents apart.

That is precisely where PAPSS changes the conversation. Developed by the African Export-Import Bank in partnership with the African Union and the African Continental Free Trade Area Secretariat, PAPSS enables businesses to make and receive payments in their local currencies while settlement is handled seamlessly across participating countries. A Nigerian importer can pay in naira, while a supplier in Ghana receives Ghanaian cedis. Neither party needs to search for dollars before a transaction can be completed. The Central Bank of Nigeria’s Payments System Vision 2028 rightly recognises that modern payments are not merely a banking service. They are economic infrastructure. Roads connect cities, electricity powers factories, while efficient payment systems connect markets. Without them, even the strongest businesses remain isolated.

The timing could hardly be more significant. The African Continental Free Trade Area brings together 54 countries, creating the world’s largest free trade area by number of participating nations. Together, the bloc represents a market of about 1.5 billion people with a combined gross domestic product exceeding 3.4 trillion United States dollars. Those figures do not automatically create prosperity, but they reveal the scale of the opportunity waiting for Nigerian producers, manufacturers, technology firms, fashion brands, creative professionals and agricultural exporters if barriers to trade continue to fall. The ability to move money efficiently is one of the essential foundations upon which that opportunity rests.

The greatest beneficiaries may well be small and medium-sized enterprises, the very businesses that form the backbone of Nigeria’s productive economy. A fashion entrepreneur in Aba should be able to sell garments to customers in Kigali without worrying that payment will disappear into weeks of banking delays. A software engineer in Lagos should find it easier to receive legitimate earnings from clients in Zambia or Rwanda. A cocoa exporter in Ondo should spend more time expanding production than navigating complicated international payment procedures. When payments become faster, cheaper and more predictable, confidence grows. When confidence grows, businesses invest. When investment rises, employment follows naturally. Prosperity is rarely created by speeches alone. It is built through systems that quietly allow enterprise to flourish.

None of this suggests that PAPSS is a magical solution to every economic challenge confronting Nigeria. Reliable electricity, efficient transport networks, stronger industrial capacity, improved security, stable macroeconomic policies and easier access to finance remain indispensable. A smooth payment system cannot compensate for factories that cannot produce competitively or roads that prevent goods from reaching ports. However, removing payment barriers eliminates one important excuse for remaining confined within national borders. It allows Nigerian businesses to compete on the quality of their products rather than on the complexity of financial transactions.

The wisdom behind this approach is hardly new. Adam Smith observed in The Wealth of Nations that, “Consumption is the sole end and purpose of all production.” His point was clear. Production achieves its purpose only when goods successfully reach buyers.

If Nigeria genuinely hopes to build a one trillion dollar economy, the journey cannot depend on consumption alone. Wealth is created when ideas become products, products become exports, and exports return earnings that are reinvested into even greater production. PAPSS may not dominate newspaper headlines every day, yet its influence could quietly reshape the commercial landscape for years to come. The Central Bank has recognised an important truth. Modern economies compete not only through factories and farms, but also through financial infrastructure that allows value to move without unnecessary friction. If implementation remains disciplined and adoption spreads across businesses and financial institutions, PAPSS could become one of the unseen engines that help Nigerian enterprise travel farther, trade faster and contribute more meaningfully to national prosperity.

Iswell The Capitalist is an economist and social media personality.
IG: @iswellthecapitalist