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- FX and settlement challenges
- Compliance and regulation
- Fintech and infrastructure advances
- Cryptocurrency and stablecoin adoption
Cross-border remittances in Africa have grown in recent years, but they remain dominated by outside-of-Africa flows and high fees.
In 2023, Sub‐Saharan Africa (SSA) received about $54 billion in remittances[1] (a slight –0.3% decline from 2022). The top recipients were Nigeria (∼$20.5B) and Ghana ($4.8B)[2], followed by Kenya ($4.2B)[3]. Together, these three accounted for over half of SSA’s remittance inflows. In per‐capita terms, East and Southern African countries have also seen strong flows (e.g. Kenya at 3.6% of GDP, Ghana 6.0% of GDP[2][3]). By contrast, countries like Tanzania (∼$0.75B, ~0.9% of GDP) and Uganda (≈$1.4B, ~3% of GDP) remain smaller remittance recipients. Intra‐African transfers (people sending money from one African country to another) are rising but still modest: Swift data show intra-SSA payment volumes grew ~13% during 2021–24, far outpacing the 3% growth in flows to outside regions[4]. Yet even now, intra-African remittances are only about 19% of all remittances to Africa[5].
Costs remain very high
The average cost to send $200 into Sub-Saharan Africa was ~7.9% in mid 2023[6], nearly triple the UN SDG target of 3%. In specific cases, it is even worse: for example, the C entral Bank of Kenya reports an average fee of 9.15% for sending $200 to Kenya in Q4 2023[7]. East African P2P/mobile networks (like M-Pesa, MTN MoMo) tend to cost less – about 5% on average[8] – but formal channel costs in the region remain well above the global average. In West Africa, some intra‐zone corridors have no currency conversion (e.g. between UEMOA countries like Benin and Côte d’Ivoire), yet remittance providers still charge significant fees, especially when involving outside currencies. In many of the corridors between our focus countries, formal service options are limited or blocked: for instance, Nigeria’s Central Bank barred most outbound transfers in 2023, creating a “no service” gap on the Ghana↔Nigeria corridor[9]. In summary, sending money across African borders is slow and expensive – a pinch point threatening the growth of intra‐African trade and diaspora investment[5][6].
- Major remittance corridors: Nigeria→Ghana and Nigeria→other ECOWAS partners; South Africa→neighboring SADC states; Kenya→Uganda/Tanzania; West Africa (Francophone)<→(Anglophone) flows, etc. (Note: many intra-African flows use informal routes, so available data may undercount them.)
- High fees: Africa remains the world’s most expensive remittance region. Formal average fees (banks/MTOs) often exceed 8–9%[7][8]. Heavy reliance on cash and lack of competition in many corridors (due to licensing or currency controls) keep costs elevated.
- Digital remittances: Money sent via regulated mobile apps or online fintech services costs ~5% [8]. P2P networks (M-Pesa, Airtel, Wave, etc.) are bridging gaps, but they require interoperability and regulatory support to fully replace cash.
- Regional disparities: Eastern and Southern Africa are seeing faster growth of intra-regional payments (thanks to mobile money saturation), whereas West/Central Africa lags behind despite shared currencies (CFA franc zones).
FX and settlement challenges
Multiple exchange rates, capital controls, and fragmented settlement systems plague intra-African payments. For example, Nigeria only recently abandoned its fixed official‐rate regime: in late 2023, the CBN unified FX rates and in Feb 2024, it removed ceilings on transfers[10]. Prior controls had diverted many remittances into black markets[6]. Ghana suffered severe cedi inflation in 2022–23, and though it maintains a full interoperable national payments switch (GHIPSS)[11], currency instability and past e‑levy proposals have squeezed users. Cameroon (part of the CEMAC “CFA-Franc BEAC” zone) enforces tight forex controls: banks must surrender foreign receipts to the BEAC central bank and apply for currency on a consolidated basis[12], causing delays and driving customers to informal channels.
By contrast, Uganda and South Africa have few FX curbs for trade: Uganda allows free currency conversion through numerous forex bureaus[13], while the South African rand floats freely (though major cross-border flows are settled in ZAR via the SADC regional RTGS)[14]. Benin and Côte d’Ivoire share the West African CFA franc, so no FX is needed between them (settlement is handled by their common central bank, BCEAO). However, any cross-border transfer from Nigeria to Benin/Ivory Coast still involves Naira–XOF conversion.
Settlement systems
Fragmented infrastructures add friction. In SADC, the SADC-RTGS (a common ZAR settlement system) links South Africa, Namibia, Eswatini, Lesotho, Malawi, Tanzania, Zambia and Zimbabwe[14]. In East Africa, the (long-stalled) EAC Payments System (EAPS) exists on paper since 2013 but is only now being revitalized under a new EAC masterplan[15]. The EAC plan (approved 2025) explicitly aims to “reduce cost and time of cross-border payments” via policy harmonization and mobile interoperability[15]. West Africa has single‐currency blocs (WAEMU, CEMAC) with shared wholesale systems (STAR-UEMOA, CEMAC payment systems[16]), and UEMOA has just launched a region‐wide real-time rail that links banks and e-money (SICA and STAR under the BCEAO)[17][18]. All these regional systems, however, largely settle in one currency (Euro or ZAR) or in large‐value flows, leaving the “last mile” problem for retail remittances.
Compliance and regulation
Anti-money‐laundering (AML) rules and licensing requirements can bottleneck remittances. Many African regulators have raised KYC/AML standards, which makes providers ask for ID verification that many small senders lack. Ghana’s recent “Guidelines for Inward Remittance by PSPs” require remittance partners to be properly licensed and compliant[19], which strengthens formal flows but adds steps. Ethiopia, Kenya, Senegal, and a few others are among the only African central banks publishing corridor‐specific data[20] – this transparency helps, but it’s the exception. In practice, these frictions mean migrants often revert to informal means or “carry cash” when sending money home.
Recent regulatory developments
Central banks are moving toward greater integration. Under AfCFTA, the African Union and Afreximbank have prioritized cross-border payments. The Pan-African Payment and Settlement System (PAPSS) launched in Jan 2022 and now connects ten central banks (including Nigeria, Ghana, Kenya, Zambia, etc.) and dozens of commercial banks[21]. PAPSS supports real-time local‐currency settlement – a potential game-changer, though it has not yet disrupted entrenched correspondent banking pathways[22]. Within West Africa, the BCEAO’s new interoperability platform directly links all mobile wallets and banks in the eight WAEMU countries[17], allowing bank-to-wallet and wallet-to-wallet transfers without friction. In East Africa, Kenya’s 2022–25 National Payments Strategy explicitly targets cross‐border connectivity, and in late 2023, Kenya joined PAPSS. 2025 saw East African leaders formally adopt a cross-border payments “masterplan” to harmonize regulations and expand systems like EAPS[15].
A notable innovation on the regulatory side is fintech license passporting. In February 2025, Ghana and Rwanda signed Africa’s first fintech passport MoU: a startup licensed in Ghana can now operate in Rwanda (and vice versa) with minimal extra approval, and their central banks agreed to link payment systems for real-time transfers[23][24]. This bilateral pact is an encouraging pilot of “one license, whole continent” thinking. More such agreements (and an eventual AU-wide passport) could substantially reduce the red tape that today bars a Ghanaian mobile money firm from expanding to Kenya or Nigeria without starting over.
Fintech and infrastructure advances
Despite the challenges, innovation is forging ahead. Mobile money continues to be the bright spot. Ghana’s GHIPSS instant payment switch already interconnects all banks and mobile wallets nationwide[11]. In WAEMU, the new BCEAO rail means a Wave wallet in Côte d’Ivoire can send money seamlessly to an Orange Money wallet in Senegal[17]. Kenya, with 84% financial inclusion, remains a tech leader: real-time networks (e.g. “IPS” instant payment) and a national ID system underpin rapid mobile transactions[7][25]. South Africa’s banks are similarly modern and link into SADC-RTGS.
On the cross-border front, startups and partnerships are scaling up. Nigerian fintech Flutterwave has aggressively expanded: it obtained a Zambian payment license in early 2025 to facilitate local mobile money and cross-border payments[26], and its “Send” app was launched in 2024 for Malawians (allowing diaspora in US/UK to send directly to Malawian bank accounts)[27]. Others like Chipper Cash, Wave, and Western Union are adding regional corridors. For example, Mukuru – a veteran remittance operator – helped sustain Southern African cash flows during COVID by routing transfers through mobile wallets[28]. Over time, digital rails (including upcoming CBDCs) and new PSP licenses (e.g. Rwanda’s FinTech Strategy 2024–29 targets 300 licensed fintechs) will improve reach and reduce costs.
Cryptocurrency and stablecoin adoption
While regulatory frameworks remain uncertain, cryptocurrency and blockchain-based payment solutions are gaining traction as workarounds to traditional remittance barriers. In Nigeria, where capital controls historically diverted flows to black markets, peer-to-peer crypto platforms like Binance P2P and local exchanges (Quidax, Busha) enabled millions to move value across borders when formal channels were blocked[31][32]. Kenya passed legislation in 2025 regulating virtual asset service providers[33], while South Africa has granted crypto asset service provider (CASP) licenses under its Financial Intelligence Centre Act[34].
Stablecoins pegged to the US dollar (like USDT or USDC) allow senders to bypass expensive currency conversions – a Ghanaian worker in South Africa can send USDC to family in Accra at fees below 3%, far less than the 7-9% charged by traditional MTOs[35][36]. Startups like Accrue, Chipper Cash and Yellow Card now connect mobile money wallets directly to crypto on/off ramps[37]. However, risks remain: regulatory bans in countries like Ethiopia and Tanzania[38], volatility concerns, and limited consumer protection mean crypto is still a niche solution. As central banks clarify private crypto rules and roll out digital currencies, blockchain rails could complement – or leapfrog – traditional correspondent banking for intra-African payments[39].
Conclusion
Intra-African payments are at an inflection point. Pan-African trade agreements and technologies like PAPSS promise to cut intermediaries and currency margins. But regulatory gaps – inconsistent licenses, foreign exchange rules, and know-your-customer hurdles – still bite. Policymakers and founders must work together to harmonize regulations, integrate payment rails (at regional and continental levels), and promote interoperable e‑money. Only by removing these “pinch points” can the full potential of cross-border African payments be unlocked – reducing costs, boosting digital financial inclusion, and fueling the intra-African commerce.
Sources: Recent data and analysis from the World Bank, central banks, AFDB/Afreximbank, national payment authorities, fintech industry reports, and development finance research.
(Key references: World Bank Migration Briefs[6][1], central bank releases[3], UNCDF/RemitSCOPE diagnostics[29][30], Afreximbank/AU payment-system reports[21][17], and blockchain analytics platforms[31].)
- [1] Remittances Slowed in 2023, Expected to Grow Faster in 2024
- [2] Remittances As a Driver of Economic Growth in Ghana | Stanbic Bank Ghana
- [3] [7] [25] Kenya – International Day of Family Remittances (IDFR)
- [4] Paper | Payment performance in sub-Saharan Africa: The role of speed in financial transformation
- [5] [20] RemitSCOPE Africa | Preliminary Release
- [6] Remittance Flows Continue to Grow in 2023 Albeit at Slower Pace | Migration and Development Brief 39
- [8] [28] Rethinking remittances: the overlooked billions sustaining African households – ISS African Futures
- [9] RPW main report, PDF
- [10] Nigeria: ongoing reforms
- [11] [19] [29] NEW: Updated Remittance Market Diagnostic – Ghana, 2023 – Remitscope
- [12] Cameroon – Trade Financing
- [13] Uganda -Trade Financing
- [14] Regional Settlement Services
- [15] EAC Unveils Regional Payment System Masterplan to Drive Financial Integration and Digital Trade
- [16] [21] [22] media.afreximbank.com
- [17] [18] Banks and mobile money finally connected: BCEAO simplifies payments – Financial Afrik
- [23] [24] Fintech passport: Why a Ghana license now works in Rwanda and vice versa – Finance in Africa
- [26] Flutterwave Secures Payment System License in Zambia – Fintech News Africa
- [27] Send App by Flutterwave Launches Affordable Cross-Border Payment Services Into Malawi
- [30] Tanzania Cross-border Remittance Policy Diagnostic – UN Capital Development Fund (UNCDF)
- [31] Sub-Saharan Africa: Nigeria Takes #2, South Africa Grows Crypto-TradFi – Chainalysis
- [32] Stablecoin Adoption in Nigeria – Plasma
- [33] Africa gets to grips with crypto as Kenya and Ghana legislate – African Business
- [34] FSCA Update on Licensed Crypto Asset Service Providers – Financial Intelligence Centre
- [35] Increasing role of cryptocurrencies in Sub-Saharan Africa – TreasuryXL
- [36] Stablecoin Boom And Its Powerhouse: Africa – Emurgo Africa
- [37] Q&A: Blockchain’s Role in African Remittances – Tech In Africa
- [38] Africa’s Growing Crypto Market Needs Better Regulations – IMF Blog
- [39] 2025 Crypto Adoption and Stablecoin Usage Report – TRM Labs