Seamless payment systems are driving financial inclusion and transforming intra-African trade.
Intra-African trade has vast potential to boost economic growth, but payment inefficiencies have long hindered its progress. According to Amber Thetford, Chief Product Officer—Card Issuing and Processing at Onafriq, modern payment solutions like debit and prepaid cards are key to addressing these challenges. These tools enable secure, seamless cross-border transactions, paving the way for a more integrated trade ecosystem under the African Continental Free Trade Area (AfCFTA).
Bridging the Payment Gap
One of the biggest obstacles to intra-African trade is the heavy reliance on cash, which accounts for around 90% of transactions in sub-Saharan Africa, as highlighted by Thetford. Cash-based trade introduces significant risks, including theft and inefficiencies, which hinder cross-border commerce.
“Card payments can eliminate the need for manual intervention and reconciliation when it comes to banking and bookkeeping. This, the World Bank states, makes them, on average, three times more cost-effective than conventional purchase order costs,” says Thetford. For small and medium-sized enterprises (SMEs), the backbone of Africa’s economy, these cards simplify trade by offering real-time, secure payment options.
Advancing Financial Inclusion
Access to, and use of more modern systems have improved the situation, but there are still issues. “While mobile money payments have greatly improved Africa’s ability to make cross-border payments, they do not meet the full scope of needs of individuals or businesses. As the United Nations points out, there are regulatory bottlenecks, while a lack of interconnectivity among mobile transactions in some countries means that people cannot transfer money across borders. Moreover, limitations of infrastructure, accessibility, and interoperability make it difficult for their users to access the global digital economy. As a result, this type of cross-border payment can be limited,” says Thetford.
The Role of Prepaid Cards in Trade Transformation
While debit cards address many of Africa’s payment challenges, Thetford highlights prepaid cards as a complementary solution with unique advantages. Unlike debit cards, prepaid cards do not require a linked bank account, making them particularly valuable in underbanked regions.
“Prepaid cards can enable businesses and individuals to transact with global institutions and marketplaces without the need to own a bank account. This option removes a pain point for a business that would otherwise need to accept local alternative payment methods or cash. Navigating challenges like high fees, currency shocks and a lack of access to traditional banks can be simplified through prepaid cards. This makes them a pivotal instrument that enhances Africa’s connection to the global economy,” explains Thetford. They also minimize the risks associated with carrying cash and simplify currency conversions, making them a vital tool for SMEs and informal traders.
“Prepaid cards can also be used to manage expenses because they can be provided to managers of, for example, a bookstore, who can then make independent decisions about business-related purchases, but only up to a certain amount. This has the added advantage of speeding up operations as there are no lengthy delays across the company when it comes to acquiring stock, while it also goes some way towards eliminating fraud as the card has a set limit,” she concludes.
As Africa’s economies become more interconnected, Thetford sees debit and prepaid cards as pivotal tools for fostering inclusive economic development. These payment solutions are not just facilitating transactions—they are driving the continent’s economic transformation, creating a trade ecosystem that is accessible, efficient, and ready for the future.
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