Cape Town, South Africa — Despite the growing potential of trade within Africa, businesses continue to grapple with significant challenges when making payments across the continent.
A paradoxical situation exists where paying a supplier in Lagos, Nigeria, often involves more friction, delays, and administrative complexity than settling a payment in London, according to Ola Oyetayo, CEO and co — founder of Verto.
The disparity is attributed to capital controls, fragmented banking systems, foreign currency shortages, and transaction limits that make regional payments more difficult than international transactions. Oyetayo emphasizes that this issue deserves more attention, especially as African countries like South Africa expand into markets such as Nigeria, Kenya, Ghana, and Tanzania. Officials commented on the matter.
While South Africa boasts sophisticated banking infrastructure and strong regulation, exchange control requirements can create additional administrative hurdles for businesses moving money offshore.
The African Continental Free Trade Area (AfCFTA) aims to boost economic integration, yet intra-African trade still accounts for only around 15% of total African trade, significantly less than regions like Europe. Oyetayo argues that payment friction is a major barrier to unlocking greater trade between African markets. Verto is addressing this challenge by expanding infrastructure to support South Africa’s dual trading reality, offering access to multiple countries and currencies.
Oyetayo stresses the need for businesses to be equipped to move seamlessly within Africa and to the rest of the world.
The situation underscores the broader economic landscape in Africa, where potential growth is often hindered by practical challenges. While cost savings in Lagos may seem appealing, overcoming the complexities of cross-border payments and navigating restrictive business environments will be crucial for companies aiming to capitalize on the African market’s potential.
*Additional reporting by ImNews | Sources consulted: 5*
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This original article was produced by the ImNews editorial team
Source: africa
Source: SG Editor
