CBN Eases Documentation Requirements for Cross Border Transactions via PAPSS
The Central Bank of Nigeria (CBN) has announced a major revision of the documentation requirements for transactions conducted through the Pan-African Payment and Settlement System (PAPSS), in a move aimed at promoting seamless intra African trade and enhancing cross border payment efficiency.
In a circular dated April 28, 2025, with reference number TED/FEM/PUB/FPC/001/006, the CBN outlined the new guidelines, which take immediate effect. The initiative is expected to facilitate easier access for Nigerian businesses and individuals to conduct transactions across the continent, supporting the broader objectives of the African Continental Free Trade Area (AfCFTA).
Under the revised framework, customers carrying out low-value transactions up to $2,000 for individuals and $5,000 for corporates can now complete transactions using only basic Know YourCustomer (KYC) and Anti-Money Laundering (AML) documents already submitted to their authorized dealer banks. For transactions exceeding these thresholds, full documentation as stipulated in the CBN Foreign Exchange Manual and related circulars remains mandatory.
The CBN further emphasized that applicants are responsible for ensuring the availability of all necessary regulatory documents required for the clearance of goods by relevant government agencies.
In a significant policy shift, authorized dealer banks are now permitted to source foreign exchange for PAPSS settlements directly from the Nigerian Foreign Exchange Market, without recourse to the Central Bank. In addition, all export proceeds repatriated via PAPSS must be duly certified by the processing banks.
PAPSS, launched in January 2022 by Afreximbank in collaboration with the African Union and the AfCFTA Secretariat, is designed to serve as a centralized platform for instant, secure, and cost-effective cross-border payments across Africa. By enabling transactions in local currencies, PAPSS reduces dependence on third-party currencies, lowers transaction costs, and strengthens trade activities within the continent.
The Central Bank of Nigeria is urging all banks to fully adopt the PAPSS platform and commence originating transactions under the new guidelines. Exporters, importers, and individuals are also encouraged to familiarize themselves with the updated requirements and leverage the system for efficient cross-border transactions.
The new measures are widely seen as a strategic move to enhance Nigeria’s participation in intra-African trade and position the country as a key player in advancing the goals of economic integration under the AfCFTA.
