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Borders are great for passports and stamps — but terrible for payments. Here’s how Africa, Asia, and the Middle East can fix that.

The Evolution of Cross-Border Payments: Catalyzing Growth in Africa, Asia, and the Middle East

Every day, billions of dollars are transferred internationally. Families rely on remittances, small and medium sized enterprises (SMEs) depend on trade finance, and entrepreneurs aim to expand their reach beyond domestic markets. However, for many in Africa, Asia, and the Middle East, the process of transferring funds continues to be slow, expensive, and disjointed. As a board member of AAMECC, I view this issue not merely as an obstacle but also as a chance for growth. With rapid advancements in financial technology, the landscape of cross-border payments is poised to transform how our regions engage in trade, investment, and development. Achieving success will necessitate collaboration between technology providers, financial markets policy, and entrepreneurship models like franchising.

1) The Current Landscape

• Africa, Asia, and the Middle East are some of the largest remittance and trade corridors globally.
• In 2023, remittances to Sub-Saharan Africa exceeded USD 50bn.
• The average transaction cost for remittances in Africa is 8%, which is far above the UN SDG target of 3%.
• Fragmented regulation, reliance on correspondent banking, and volatile FX are some of the factors that hinder progress in reducing transaction costs

2) Innovation & Digital Transformation

Fintech and digital infrastructure are changing the game: • Mobile money is driving inclusion in East Africa.

• Digital-first banks in the Middle East are speeding up settlements.
• Blockchain and stable coins promise lower costs and better transparency.

These aren’t just tools for moving money. They’re about unlocking participation in the global economy.

3) Empowering SMEs & Franchising

SMEs are the backbone of our economies and they depend on affordable, reliable cross border payments to scale.

• Faster settlements lead to easier supplier relationships.
• Lower FX costs make exports more competitive.
• Greater access increases confidence to expand across borders.

A significant avenue for growth is international franchising. By leveraging digital payments and streamlined foreign exchange management, companies in cities like Nairobi, Dubai, or Jakarta can easily duplicate and expand their operations internationally. The combination of franchising & payment solutions establishes a cross border entrepreneurship framework.

4) Policy, Regulation & Financial Markets Integration

Cross-border payments are influenced by the broader context of financial market policies:

• Foreign exchange regulations and capital controls in certain African markets restrict the repatriation of funds, while Gulf nations enjoy advantages from their dollar-pegged currencies.
• Initiatives like the African Continental Free Trade Area (AfCFTA) and the Pan African Payment and Settlement System (PAPSS) are transforming trade dynamics and payment systems in the region.
• Central bank innovations such as Central Bank Digital Currency (CBDC) pilot projects in Nigeria, Ghana, and Kenya demonstrate a growing momentum in policy development.

Without enabling FX regimes and regulatory frameworks, even the best technology cannot scale. Policy determines whether capital flows freely, efficiently, and fairly.

5) Currency Volatility & FX Risk Management

FX volatility continues to pose a significant threat for companies looking to expand regionally.

• The fluctuations in rates such as USD/GHS in Ghana, USD/TZS in Tanzania, and EUR/XOF EUR/XAF in Francophone region of Africa can severely impact (positively or negatively) profit margins.
• Central bank actions and IMF initiatives often influence these moves.
• Practical solutions like forwards, options, structured FX products, and liquidity partnerships enable SMEs and larger enterprises to hedge against risks and maintain their stability.

6) A Borderless Future

The future of payments is not just faster and cheaper but about inclusion, resilience, and entrepreneurship: Migrant workers sending money home instantly at near zero cost. SMEs settling invoices across continents in seconds. Franchises scaling seamlessly into new markets. Regional currencies stabilised by efficient hedging. This is the transformation within reach.

Conclusion

For Africa, Asia, and the Middle East, seamless cross-border payments will define the next chapter of growth. They will:

• Unlock opportunities for entrepreneurs.
• Empower SMEs to franchise globally.
• Channel remittances into engines of sustainable development.

At AAMECC, our goal is to link markets, encourage collaboration, and advocate for innovation. By harmonizing policy, technology, and entrepreneurship, businesses are creating not only a simpler method of transaction but also a more inclusive, borderless, and thriving future. 🚀 If money can move at the speed of a text message, why should borders slow it down? Curious to hear your thoughts.