|How to PAPSS is designed to operate|
The implementation of the Pan African Payments and Settlement System (PAPSS) has already taken effect with the CBN mandating financial institutions, Merchants and individuals who are involved in Cross-border trade to use it for payment settlement.
During the Lumi’s first year anniversary celebration, the Diaspora Central Bank’s President McPherson gave an insight on how or when the Lumi currency will be exchanged. He said, as the African Continental Free Trade Agreement (AfCFTA) is implemented, we will see goods and services being from the continental Africa and the Caribbean (within the ECO-6).
During this period, goods or services being bought from the Eco-6 Region will be paid in Lumi Currency.
We can rightly say that the time is already here. The AfCFTA began its implementation last year January 2022 with Ghana leading the way.
In essence, what McPherson said can be simplified thus;
“if ECOWAS adopts Eco as it’s regional currency, exporters from South African Region can come to west Africa, buy goods and pay in Eco (ECOWAS single currency)
So when we take our products to the Caribbean we will be paid in Lumi or if we want to buy products from the Eco-6 Region we will be required to pay in Lumi.
However, to lessen the task the Afrexim Bank, African Union and AfCFTA secretariat jointly established Pan African Payment and Settlement System (PAPSS) to handle payments associated with the AfCFTA programme.
With the introduction of PAPSS we need not to worry about how to convert our naira, Dollar,Cedi, Kwacha or Rand anymore. Just pay the Nigerian merchant in Rand and her or she will be credited in Naira. Or Let the Jamaican trader pay a Ghanian in Lumi and the Ghanian will be credited in Cedi.
Exchange of the Lumi is what will definitely take place this year, 2022.