Instant Payment Systems: A Cornerstone of Africa’s Future Digital Public Infrastructure
Instant Payment Systems (IPS) are emerging as a critical component in building Africa’s digital public infrastructure (DPI), according to the SIIPS 2025 report. This infrastructure rests on three key pillars: digital payments, digital identity, and secure data exchange. The development of robust IPS is seen as essential for modernizing financial systems and driving economic growth across the continent.
The Strategic Role of IPS in Africa’s Digital Transformation
A fully operational DPI, enabled by effective IPS, has the potential to revolutionize public service delivery, significantly reduce transaction costs, and promote greater financial transparency. Currently, only a handful of African nations have a fully functional DPI. Key obstacles hindering broader adoption include institutional fragmentation, insufficient investment, a skills gap, and concerns regarding data protection and security. Overcoming these challenges is crucial to unlocking the full potential of IPS.
Furthermore, IPS are a vital tool for modernizing government-to-person (G2P) payments. Annually, approximately $31 billion is transferred to African households through social programs, with many of these transactions still managed manually. By digitizing these flows through IPS, governments can improve efficiency, reduce leakage, and enhance financial inclusion for vulnerable populations. The widespread implementation of IPS promises a more efficient and transparent future for financial transactions and public services in Africa.
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