FG seeks Africa-wide payment card to bypass dollar

From Adanna Nnamani, Abuja

The federal government has proposed the development of an Africa-wide payment card that would enable direct transactions between African currencies without requiring conversion through the United States dollar or other intermediary currencies, as part of efforts to deepen intra-African trade and reduce transaction costs.

Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, made the proposal on Tuesday while receiving a delegation from Mastercard in Abuja.

Oyedele said Africa’s payment ecosystem should move beyond traditional systems that rely on third-party currencies for cross-border transactions, noting that such arrangements increase costs and create inefficiencies.

Currently, most card payments between African countries are routed through currencies such as the U.S. dollar. For instance, when a Nigerian cardholder makes a purchase in Ghana, the transaction is often converted from Ghanaian cedis to U.S. dollars before being converted into naira, attracting additional costs through multiple exchange-rate conversions.

Speaking during the meeting, the minister urged Mastercard to support the creation of a payment system that allows direct settlements between African currencies.

“We hope that, for example, we have a payment card that you can use to pay from naira to Kenyan shillings, to South African rand, without a third currency. And we know you can make it possible,” Oyedele said.

He said eliminating intermediary currencies would improve payment efficiency, reduce transaction costs and strengthen economic integration across the continent, particularly under the framework of the African Continental Free Trade Area (AfCFTA).

The minister also called on Mastercard to expand access to credit cards in Nigeria, describing consumer credit penetration as low even among top public officials and high-income earners.

“Based on my own personal experience, one of the areas where we hope you will take the lead is just making credit cards available to Nigerians.

It is difficult, even for someone at my level, to get a credit card,” he said.

While acknowledging the progress made by Nigeria’s financial technology sector, Oyedele said there remains significant room for growth and innovation.

He noted that Nigeria hosts five of Africa’s nine fintech unicorns, reflecting the country’s growing prominence in the continent’s digital finance landscape.

“Our fintech sector is quite developed, but we know that we can do much better. We can be much bigger,” he said.

“It is interesting to know that Africa has nine unicorns, and five of them are in Nigeria. So we know that the possibilities are even bigger.”

Oyedele assured investors and fintech operators of the government’s commitment to maintaining policy consistency and providing regulatory support to encourage further investment and expansion.

“We welcome you to Nigeria. We want you to do more, and we are willing, from the government’s side, to work with you,” he added.

The proposal comes amid expectations of rapid growth in Africa’s cross-border payments market over the next decade. Industry reports project the market will expand significantly as fintech adoption rises, mobile money usage grows, and intra-African trade increases under AfCFTA.

Despite the growth prospects, stakeholders say cross-border payments across Africa continue to face challenges including fragmented financial systems, multiple currency conversions, high transaction costs and settlement inefficiencies.

Experts believe direct settlement mechanisms between African currencies could help address these challenges, lower costs for businesses and consumers, and accelerate economic integration across the continent.

The federal government’s proposal is expected to add momentum to ongoing efforts to build a more connected African financial ecosystem capable of supporting the continent’s expanding trade and digital economy ambitions.