East African Community to Launch Single Cross-Border Payment System

 The East African Community (EAC) will establish a regional cross-border payment system, according to a press release from the EAC following an extraordinary meeting of representatives from the central banks of member states.

"The meeting, chaired by the Bank of Uganda and with the secretariat led by the National Bank of Rwanda, marked a significant transition from the planning phase to the practical implementation of the master plan, which is a coordinated roadmap for creating an integrated, secure, efficient, affordable, and inclusive regional cross-border payment ecosystem," the organization's statement read.

The organization's senior statistician, Samuel Nkurunziza, reaffirmed the EAC Secretariat's commitment to working closely with partner states and other stakeholders to accelerate the regional integration of cross-border payments.

"Stronger and more integrated cross-border payment systems are crucial for facilitating intra-regional trade, expanding access to financial services, and promoting the broader EAC regional integration agenda," a representative of the organization stated.

The master plan for implementing this system is based on four key principles: governance, legal and regulatory framework, infrastructure, and inclusivity and capacity building. The plan also includes 20 strategic initiatives for implementing cross-border payments in EAC member states.

During the sessions, working groups reviewed three foundational documents: a monitoring and reporting program, a draft regional framework agreement on joint oversight of cross-border payment systems, and a mutual recognition program for payment service providers.

In July, the East African Community (EAC) countries reaffirmed their intention to create a single currency by 2031. The creation of a single currency will be the third phase of the EAC's integration. A common market and a customs union already function among the member states, while a fourth phase aims to establish a single political federation.

The EAC comprises eight countries: Kenya, Tanzania, Uganda, Burundi, Rwanda, South Sudan, the Democratic Republic of the Congo, and Somalia, which joined the organization in March 2024.