Today on The Settlement Layer: To break the correspondent banking bottleneck, national switches across Africa are now federating their wallets directly. Further East, Kenya is slashing reserve capital rules in a bid to domesticate institutional stablecoin liquidity.
Fintech aggregator PawaPay announced on Thursday that it has processed over 3 billion mobile money transactions valued at €10 billion, linking global and regional businesses to nearly 50 mobile network operators across 20 African markets via a unified API. Citing GSMA data showing African merchant mobile money payments reached $155 billion in 2025 (up 42% year-on-year), PawaPay highlighted Ghana, Tanzania, Cameroon, and Uganda as its fastest-growing merchant corridors.
Why it matters
The volume milestone underscores how mobile money has transitioned from consumer P2P transfers into the dominant B2B and merchant acquiring layer across Sub-Saharan Africa (excluding Nigeria). API aggregators that simplify single-point integration across fragmented telco switches are effectively replacing traditional card acquiring rails for digital commerce.
The South African Reserve Bank announced on Tuesday that it has extended the discontinuation deadline for the Johannesburg Interbank Average Rate (Jibar) by five months, moving it from December 31, 2026, to May 31, 2027. SARB Deputy Governor Rashad Cassim explained that the delay is necessary to allow Parliament time to pass legal fallback provisions protecting tough legacy contracts transitioning to ZARONIA. Outstanding Jibar-linked financial instruments currently total R2.5 trillion in assets and R38.9 trillion in derivatives.
Why it matters
Postponing the Jibar phaseout avoids legal uncertainty and interest rate calculation errors across South African commercial lending and corporate treasury agreements. For B2B payment providers operating ZAR settlement and working capital facilities, the extension provides critical runway to adjust core treasury pricing engines and derivative contracts to ZARONIA benchmarks.
African payments infrastructure provider Enza closed a $6 million Seed+ round led by 4DX Ventures, with participation from British International Investment, Quona Capital, and Algebra Ventures. Founded in 2022 by former Network International executives, Enza provides a single API middleware connecting commercial banks to card schemes, mobile wallets, and domestic real-time switches including NIBSS and PayShap. Operating across 12 countries, the company recently went live in Ghana under an Enhanced PSP license and reports 35% to 40% month-on-month growth in contracted monthly transaction volumes.
Why it matters
Enza's expansion demonstrates that Tier-1 and Tier-2 African banks are increasingly outsourcing payment rail orchestration to specialized B2B middleware providers to bypass legacy core banking limitations. For gateway operators partnering with regional banks, the proliferation of standardized middleware simplifies integration into local switches like PayShap and NIBSS without maintaining custom host-to-host links.
Verifone deployed Visa-owned Featurespace adaptive machine learning models across its global payment gateways on Wednesday. The risk engine screens over 1,800 transaction attributes in real time while maintaining response latency under 100 milliseconds. Using Visa's Adaptive Behavioral Analytics, the platform constructs dynamic behavioral baselines for individual merchants, cards, and accounts across card-present, online, and mobile checkout flows.
Why it matters
Sub-100ms latency for deep attribute analysis sets a benchmark for production AI in payment processing, allowing acquirers to evaluate complex risk signals without degrading checkout conversion. Integrating behavioral profiling directly at the gateway layer helps reduce false declines on legitimate cross-border transactions while stopping card-not-present fraud vectors.
AI chargeback management vendor Justt launched three platform upgrades on Wednesday: Justt Flows, a no-code dispute automation engine; Consistent Disputers, a buyer-level risk intelligence tool linking repeat friendly fraud across email, IP, and card BIN attributes; and native PayPal Alerts integration. The PayPal module surfaces pre-chargeback warnings directly from PayPal's network, which standard card-network alert feeds cannot detect.
Why it matters
Closing the alert blind spot for PayPal transactions eliminates a major source of unmonitored dispute losses for digital merchants. Cross-referencing repeat disputers at the buyer level rather than relying solely on card BINs equips merchant risk teams with predictive intelligence to block friendly fraud before chargebacks incur gateway fines.
Switch Al-Maghrib Managing Director Hanae Ben Driss confirmed on Wednesday that Morocco's national switch is establishing a formal association alongside national switch operators in Nigeria, Ghana, Rwanda, and Angola. The initiative establishes a technical framework for direct cross-border wallet-to-wallet clearing, intentionally bypassing international card networks like Visa and Mastercard. Additionally, Switch Al-Maghrib has embedded real-time AI fraud scoring directly into its national routing engine to lower compliance overhead for participating institutions.
Why it matters
Bypassing correspondent banking chains and card scheme interchange through direct account-to-account wallet switching cuts cross-border settlement costs and latency. For gateway operators, integrating with a federated association of national switches offers a scalable path to multi-country mobile money clearing without establishing separate bilateral integrations in every jurisdiction.
Building on the East African Community's cross-border payment expansion we covered yesterday, Ugandan First Deputy Prime Minister Rebecca Kadaga briefed Parliament on Tuesday with new data showing the strain on current infrastructure. While the East African Payment System (EAPS) connects RTGS switches across four nations, Bank of Uganda data reveals its transaction volumes actually fell 12.5% to 21,648 in the year to June 2026—even as total transfer value rose 60.5% to Shs 982.4 billion. Lawmakers noted that commercial banks face acute regional currency shortages, forcing cross-border traders into double conversions via US dollars.
Why it matters
The rise in average transfer size alongside falling transaction counts indicates that small merchants are being priced off formal central bank payment rails due to commercial bank FX illiquidity. Until EAC central banks implement effective regional currency liquidity facilities, B2B payment gateways must maintain alternative cross-currency routing or stablecoin liquidity pools to insulate merchants from double conversion fees.
A joint study published Wednesday by the International Trade Centre and Afreximbank projects Africa-Caribbean trade will reach $1.65 billion by 2030, supported by Afreximbank increasing its CARICOM financing facility to $5 billion. To eliminate correspondent banking friction, Afreximbank is deploying the Caribbean African Payment and Settlement System (CAPSS). Modeled on PAPSS, CAPSS enables direct local-currency trade clearing between African and Caribbean commercial banks without converting through US dollars or Euros.
Why it matters
Deploying PAPSS technology across Atlantic trade corridors demonstrates the international expansion of local-currency settlement infrastructure. For cross-border payment platforms, CAPSS opens direct clearing avenues for export-import merchants trading between West Africa and the Caribbean, bypassing Western clearing houses and reducing FX spread costs.
The cNGN stablecoin consortium detailed technical progress on Thursday regarding its naira-pegged digital token operating under the Nigerian SEC's Accelerated Regulatory Incubation Programme (ARIP). Backed 1:1 by naira reserves held with licensed custodian banks, cNGN integrates natively with exchanges like Busha and Quidax. The architecture allows corporate finance teams to execute programmable marketplace payouts, instant merchant settlements, and supplier disbursements directly on-chain in naira without generating FX conversion friction.
Why it matters
Local currency stablecoins like cNGN allow Nigerian merchants to access the speed and programmability of blockchain rails while keeping transactions anchored to domestic currency accounting. Integrating cNGN into payment gateways offers a 24/7 instant settlement alternative to traditional NIBSS card payout cycles.
On Thursday, Kenya's National Treasury published updated regulatory rules lowering the paid-up capital requirement for stablecoin issuers by 40% to KSh 300 million ($2.32 million). Overseen by the Central Bank of Kenya under Legal Notice 134 of 2026, the framework mandates that 100% of backing reserves must be held in Kenyan commercial banks and explicitly prohibits offering yield or interest rewards to token holders. Virtual asset payment processors face a lower capital threshold of KSh 10 million.
Why it matters
Slashing capital requirements lowers the barrier for regulated stablecoin issuers to establish local fiat ramps, but the requirement to lock reserves inside Kenyan commercial banks keeps liquidity firmly within the domestic banking sector. Prohibiting interest rewards forces stablecoins to compete purely as transaction settlement rails rather than speculative yields, aligning with gateway needs for predictable, low-cost B2B clearing.
Moving on the Central Bank of Kenya's mandate to dismantle mobile money walled gardens, KCB Bank Kenya and Airtel Money Kenya activated a direct merchant interoperability partnership on Thursday. The link allows Airtel Money subscribers to pay directly at KCB merchant tills using Lipa Na KCB, reducing acceptance charges and expanding direct wallet-to-bank-till processing. KCB noted that non-branch digital channels now account for 99% of its total transaction volume.
Why it matters
Direct interoperability between Kenya's second-largest mobile wallet and a primary bank acquiring network breaks down closed-loop merchant acceptance. Lowering merchant acquiring fees encourages small retailers to accept multi-wallet digital payments on a single till, expanding the addressable point-of-sale network for digital checkout gateways.
Adding to the rollout of Google Wallet tokenisation by Nigerian lenders we tracked earlier this week, Wema Bank launched Google Pay integration on Wednesday for its Mastercard holders. Announced by Managing Director Moruf Oseni, the service enables contactless tap-to-pay via NFC-enabled Android devices and tokenised web checkout. The deployment leverages Mastercard tokenisation to substitute sensitive card numbers with dynamic digital tokens during transaction processing.
Why it matters
Wema Bank's activation confirms that tokenised mobile wallets are rapidly becoming standard across Tier-1 and Tier-2 Nigerian issuers. Tokenised checkout flows reduce card-not-present fraud risks and improve payment approval rates for online merchants operating in the Nigerian market.
National Switches Build Bottom-Up Wallet Federations Outside International Card Schemes Rather than waiting for top-down treaties, domestic switch operators like Morocco's Switch Al-Maghrib are linking directly with peers in Nigeria, Ghana, Rwanda, and Angola to form a continental switch association. This architecture targets direct account-to-account and wallet-to-wallet clearing across borders, cutting out Western card network fees.
East African Regulators Trade Yield Incentives for Bank-Held Reserve Safeguards Kenya's 40% capital requirement reduction for stablecoin issuers signals a shift toward attracting regulated crypto operators, provided local reserves sit in domestic commercial banks. Prohibiting yield-bearing rewards enforces stablecoins as pure transaction instruments while protecting bank deposit bases.
Merchant Acquiring Moves Beyond Hardware Terminals to SoftPOS and Middleware Stacks As B2B infrastructure providers like Enza raise capital to unify bank connections to PayShap, NIBSS, and mobile money, acquirers are bundling SoftPOS software with inventory systems. Shifting away from dedicated POS hardware lowers merchant onboarding costs across high-mobile markets.
Gateway Security Moves Pre-Authorization Risk Scoring Below 100 Milliseconds Major gateway providers and dispute engines are embedding sub-100ms machine learning models and buyer-level telemetry to evaluate transaction attributes in real time. Replacing static rules with behavioral baselines targets friendly fraud and account takeovers before authorization requests hit card networks.
Regional Settlement Networks Confront Commercial Banking Liquidity Bottlenecks While regional mechanisms like EAPS in East Africa and CAPSS in the Caribbean push to eliminate dollar reliance, commercial bank regional currency shortages continue to force double conversions through USD. Central bank liquidity facilities are becoming necessary to backstop local-currency clearing.
What to Expect
2026-11-30—Public consultation window closes for South African Reserve Bank's Synthetic Financial Centre (SFC) exchange control framework.
2026-12-31—Tanzania's mandatory electronic payment order takes effect across key commercial sectors under the Electronic Transactions Order 2026.
2027-01-01—Central Bank of Nigeria and NITDA mandatory data localisation deadline for payment transaction data.
2027-05-31—South African Reserve Bank revised deadline for the final phaseout and discontinuation of Jibar in favor of ZARONIA.
2027-06-30—BCEAO scheduled rollout date for cross-border instant payments across the eight WAEMU member nations on the PI-SPI switch.
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