Technology News: COMESA Launches Digital Payments Platform
The Common Market for Eastern and Southern Africa (COMESA), a significant trade bloc spanning 21 African nations and representing a population of over 640 million people, has unveiled a groundbreaking digital payments platform. This innovative system aims to revolutionize trade within the region by simplifying cross-border transactions and significantly reducing costs for businesses, all while fostering the use of local currencies instead of the US dollar.
Streamlining Trade with Digital Payments
The newly launched platform, known as the Digital Retail Payments Platform, is designed to facilitate direct settlements in national currencies for traders engaged in cross-border activities. Currently undergoing pilot testing between Malawi and Zambia, the ultimate goal is to expand its reach to all 21 COMESA member states, including major economies such as Kenya, Ethiopia, and Egypt. This initiative promises to significantly lower the cost of conducting trade within the bloc. COMESA aims to keep transaction costs below 3% of the value of each transaction, a substantial decrease compared to the current average of approximately 8%. The platform is being developed in collaboration with two digital financial service providers and a foreign exchange firm, although the specific names of the partners have not yet been disclosed.
The Digital Retail Payments Platform represents a major step toward reducing reliance on foreign currencies and empowering African businesses to trade more efficiently and affordably within the COMESA region.
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