Nigeria is tightening its grip on both ends of the digital transaction lifecycle today, pushing for a complete overhaul of its national cybercrime strategy while the SEC simultaneously aims for zero-fail T+1 settlement. Elsewhere on the continent, South Africa is weighing a massive national ID mandate for SIM cards to stem fraud, and Kenya's central bank has formally backed the PAPSS network for local currency trade.
Justice sector leaders in Nigeria are calling for a structural overhaul of the country's cybercrime strategy to counter a rapid evolution in threats, including AI-assisted crimes, deepfakes, voice cloning, and cryptocurrency-enabled offenses. On Monday, the Federal Ministry of Justice and its partners emphasized the need for advanced evidentiary frameworks, better inter-agency collaboration, and continuous professional development for legal professionals.
Why it matters
This high-level push for a new national strategy signals that Nigeria's regulatory and enforcement bodies are treating AI-driven fraud as a systemic risk. For a payment gateway, this is a critical development. It suggests that future regulations will likely demand more sophisticated fraud detection and reporting capabilities. The focus on digital evidence and inter-agency cooperation could also lead to more effective prosecution of payment-related fraud, but will require payment providers to maintain meticulous, auditable logs.
The delayed fintech regulatory roadmap we've been tracking from South Africa's FSCA is now translating into quantified systemic risk. With digital banking fraud losses surging 86% to R1.888 billion, a new report highlights that the sluggish rollout of the Conduct of Financial Institutions (COFI) Bill, combined with fragmented defenses against AI-driven attacks, is leaving the financial sector dangerously exposed.
Why it matters
The sheer scale of the fraud increase underscores that existing defenses are being overwhelmed. For payment providers, this is a direct threat to operational integrity. Merely waiting for the 2027-2029 FSCA regulatory timeline we previously covered is insufficient; a proactive, integrated security strategy that counters AI-driven social engineering is now a baseline requirement for survival in the South African market.
In an analysis published Monday, Winston Osuchukwu, CEO of Mathesis Analytics Inc., argued that Africa's financial infrastructure is being reshaped by three interdependent pillars: connected ecosystems, data intelligence, and AI-driven decision-making. He contends that competitiveness now hinges on an institution's ability to integrate disparate data sources, interpret them intelligently, and use AI to automate actions in areas like fraud detection, lending, and compliance.
Why it matters
This piece provides a clear strategic framework for where the African fintech market is heading. The argument is that simply being digital is no longer enough; value is now created at the intersection of interoperability, data analysis, and intelligent automation. For a B2B payment gateway, this means the future isn't just processing transactions, but offering data-driven insights and AI-powered services (like dynamic fraud scoring or checkout optimization) that help merchants operate more effectively.
Speaking at the AfCFTA Digital Trade Forum 2026 on Monday, Jumia Nigeria CEO Temidayo Ojo called for harmonized payment frameworks and stronger consumer protection policies to accelerate digital commerce across Africa. He identified fragmented payment systems and low consumer trust as major obstacles to intra-African trade, which initiatives like PAPSS and AfCFTA aim to solve.
Why it matters
This is a direct signal from one of the continent's largest e-commerce players that payment fragmentation is a primary growth constraint. For a pan-African payment gateway, this reinforces the core value proposition of providing a unified payment layer. Ojo's comments provide strong validation for focusing on cross-border interoperability and could be used to frame discussions with partners and regulators about the urgent need for streamlined settlement systems.
Following Afreximbank's recent campaign to overcome initial central bank resistance to the Pan-African Payment and Settlement System (PAPSS), the Central Bank of Kenya (CBK) has officially thrown its weight behind the network. Speaking at the Montran Africa Market Infrastructure Summit, the CBK formally endorsed the local-currency settlement platform to help cut reliance on costly correspondent banking.
Why it matters
The CBK's formal backing adds significant weight to the PAPSS initiative, especially in the crucial East African hub. While PAPSS has been in development for years, adoption by major central banks is the key catalyst for it to become a viable settlement rail. This move signals a genuine commitment to reducing intra-African trade friction, which could dramatically lower costs and settlement times for merchants transacting between Kenya and other participating nations.
Virtual cards are increasingly being adopted in East Africa to connect the region's dominant mobile money ecosystems to the global, card-based digital economy, according to a report on Monday. These cards provide secure, manageable credentials linked to local accounts, enabling SMEs and consumers to overcome the friction of using local payment methods on international platforms.
Why it matters
This trend represents a crucial market adaptation, creating a functional bridge where direct integration is lacking. For a payment gateway, the rise of virtual cards is a dual signal: it validates the demand for cross-border e-commerce while also highlighting a market gap that integrated payment solutions could fill more efficiently. It's a workaround that proves the problem is real and valuable to solve.
South Africa is facing a renewed threat of being greylisted by the Financial Action Task Force (FATF) due to its expanding illicit economy, estimated to cost the tax system R84.6 billion annually. Reports on Monday warn that despite exiting the greylist in October 2025, the scale of illicit financial flows is overwhelming the country's anti-money laundering systems and enforcement capabilities.
Why it matters
A return to the FATF greylist would have severe consequences for the South African financial system, increasing the cost and complexity of all cross-border transactions. For a payment gateway, this would mean heightened scrutiny from international partners, potentially higher compliance costs, and delays in settlement. The threat underscores the systemic importance of robust AML/CFT controls for all financial players in the country.
South Africa is planning a significant overhaul of its SIM card registration system (RICA), aiming to link every SIM to a verified identity from the Department of Home Affairs (DHA) database. The proposal, reported on Monday, is a direct response to the surge in sophisticated digital fraud since 2019 that leverages SIM-based identity for attacks on banking and fintech platforms.
Why it matters
This represents a potential fundamental shift in digital identity verification in South Africa. If implemented, it could significantly reduce SIM-swap fraud and synthetic identity abuse, major pain points for payment processors and merchants. For APS, this would create a much stronger foundation for KYC and user authentication, potentially lowering fraud rates and the associated operational costs of dispute management. The key will be to watch how this policy develops and what the technical requirements for verification will be.
Busha Business, the B2B arm of Nigerian crypto exchange Busha, announced a partnership with Tether on Monday to integrate the USDt stablecoin for cross-border settlements. The collaboration aims to provide thousands of businesses in Nigeria and Kenya with a licensed, frictionless channel for international payments and treasury management, bypassing traditional banking delays and local currency volatility.
Why it matters
This partnership is another concrete example of stablecoins being positioned as enterprise-grade payment infrastructure, not just speculative assets. By focusing on a licensed and regulated framework, Busha and Tether are directly addressing the compliance concerns that often hinder institutional adoption. For a payment gateway, this signals a maturing market where stablecoin rails are becoming a viable, and potentially necessary, component of a comprehensive cross-border payment offering.
Esther Waititu will resign as Safaricom's Chief Financial Services Officer on July 31, 2026, marking another high-profile departure from the M-PESA leadership team. Waititu oversaw M-PESA's evolution into a broader financial services platform, including the modernization of its architecture and the expansion of its Daraja API ecosystem. Her exit comes as Vodacom consolidates its majority control over Safaricom.
Why it matters
This leadership churn within the division that generates nearly half of Safaricom's revenue creates uncertainty. M-PESA's stability, API roadmap, and cross-border strategy are critical infrastructure for countless businesses. The departure of key architects of its current platform could impact the pace of innovation and the reliability of the service, factors that directly affect any payment gateway integrating with M-PESA. Boniface Mungania has been named interim CFSO.
Nigeria's Securities and Exchange Commission (SEC) is targeting a near-zero trade fail rate for its T+1 settlement cycle by the second half of 2026. To achieve this, the SEC is enforcing stricter delivery-versus-payment discipline and working with the Central Bank of Nigeria (CBN) to enable same-day forex execution and modernize the Certificate of Capital Importation (CCI) process.
Why it matters
Improving settlement efficiency and forex repatriation processes is critical for attracting and retaining foreign capital. For a payment provider facilitating cross-border flows, the modernization of the CCI process and the push for same-day FX execution could significantly reduce operational friction. This move, if successful, would make it faster and more reliable to repatriate funds for multinational merchants, a key pain point in the Nigerian market.
Nigeria Ramps Up Regulatory and Enforcement Efforts Nigeria is taking a multi-pronged approach to shore up its financial ecosystem. On one hand, the justice ministry is pushing for a complete overhaul of its cybercrime strategy to combat AI-driven fraud. On the other, the SEC is targeting near-zero trade failures and faster forex execution to bolster investor confidence, while the CBN's restrictive monetary policy continues to hold.
AI's Dual Role: Fueling Fraud and Powering Defense The arms race in financial crime is intensifying across Africa. Reports from South Africa and Nigeria highlight the surge in sophisticated, AI-assisted fraud, including deepfakes and identity spoofing. In response, regulators are calling for new legal frameworks and security measures, while the industry looks to advanced AI tools like graph databases and self-hosted AML investigators for defense.
Stablecoins Gain Ground as B2B Settlement Infrastructure The use of stablecoins for B2B cross-border payments is moving from theory to practice. A partnership between Busha Business and Tether aims to provide licensed stablecoin infrastructure in Nigeria and Kenya. This follows the broader trend of enterprise-grade stablecoins like USDGO gaining traction for treasury management and settlement in emerging markets, offering an alternative to traditional banking rails.
Infrastructure Fragmentation Remains a Core Challenge Despite progress, the inadequacy of Africa's financial infrastructure remains a critical bottleneck. Jumia's CEO is calling for payment harmonization to unlock AfCFTA's potential, while industry experts note that the continent's borderless economy is outgrowing its underlying rails. The push for PAPSS adoption by countries like Kenya is one response to this persistent fragmentation.
South Africa Grapples with Systemic Risks South Africa is facing a convergence of financial risks. The country is under renewed threat of FATF greylisting due to an expanding illicit economy. Simultaneously, rising digital banking fraud and the slow implementation of the COFI bill are straining financial institutions, forcing a national conversation about stronger, system-wide fraud prevention, including linking SIM cards to digital IDs.
What to Expect
2026-07-22—Central Bank of Nigeria's Monetary Policy Committee announces interest rate decision.