COMESA DRPP Live: Boosting Africa's Local Currency Trade

The financial landscape of Eastern and Southern Africa is undergoing a profound transformation with the official launch of the Common Market for Eastern and Southern Africa's (COMESA) Digital Retail Payments Platform (DRPP). Going live on October 9, this groundbreaking initiative ushers in a new era where the bloc's 21 member states can engage in direct cross-border trade using their respective local currencies, effectively bypassing the long-standing reliance on the US dollar. This strategic pivot is more than just a technological upgrade; it represents a significant step towards greater economic sovereignty and efficiency within the region.

Revolutionizing Intra-African Trade with Digital Payments

The introduction of the DRPP addresses several critical pain points that have historically hampered intra-COMESA trade. Foremost among these are the protracted settlement delays and the elevated transaction costs associated with dollar-denominated exchanges. By enabling near-real-time settlement, the platform dramatically streamlines payment processes, offering businesses and individuals unprecedented speed and predictability. Furthermore, it significantly alleviates the persistent dollar-funding pressure that has often constrained regional banks, freeing up capital and reducing exposure to foreign exchange volatility.

Chileshe Kapwepwe, the Secretary-General of COMESA, underscored the immense importance of this development during the launch, stating, "This platform is a major step toward reducing currency-conversion losses and strengthening intra-COMESA trade." She further highlighted the substantial financial drain caused by the traditional system, noting that member states collectively incur "hundreds of millions of dollars annually" due to the costs and volatility inherent in dollar-denominated settlements. The DRPP stands poised to reclaim these losses, redirecting valuable capital back into the regional economy.

The Mechanics of a Seamless System

The operational efficacy of the DRPP has been rigorously validated through extensive pilot tests conducted over a six-month period. These trials involved central banks from key COMESA nations including Kenya, Egypt, Zambia, Rwanda, Malawi, and Uganda. Commercial banking partners, such as Equity Group, KCB Group, Zanaco, and CIB Egypt, also participated, ensuring a comprehensive evaluation across the financial spectrum. The COMESA’s Payments Unit reported an impressive tally of over 11,000 test transactions, with a remarkable average settlement time of under two minutes. This stands in stark contrast to the 48-72 hours typically required for transactions processed via offshore correspondent banks, demonstrating a paradigm shift in transactional efficiency.

Dr. Emily Musaba, COMESA’s Director of Trade Integration, projects significant financial advantages for regional businesses. "Exporters could save 2%-4% on conversion costs once fully implemented," she anticipates. These savings, seemingly incremental at the individual transaction level, will accumulate to substantial figures across the region's $30 billion in annual intra-regional trade, providing a tangible boost to profitability and competitiveness for African businesses.

At its core, the DRPP is robustly anchored by COMESA’s 2025-published Regional Payment and Settlement Regulations. This regulatory framework mandates that participating central banks maintain prefunded settlement accounts, a critical mechanism designed to effectively mitigate both credit and liquidity risks. This proactive approach ensures the stability and reliability of the payment system, fostering confidence among all stakeholders and laying a solid foundation for sustainable growth.

Broadening Economic Horizons and Financial Autonomy

The implications of the DRPP extend far beyond mere transactional improvements. Analysts predict that this initiative could strategically reroute a substantial portion of the region's intra-regional trade onto African clearing rails. This shift holds the potential to profoundly reshape regional banking flows, influencing how global financial institutions assess correspondent-banking exposure and how they price foreign exchange risks across the African continent. Commercial lenders within the COMESA bloc, in particular, will experience a reduced reliance on dollar clearing, leading to improved liquidity management and the ability to price cross-border financial products more competitively.

Secretary-General Kapwepwe powerfully articulated the overarching philosophy behind this reform: it is fundamentally about enhancing financial autonomy, not promoting isolationism. "This isn’t about turning away from global markets; it’s about positioning Africa as a predictable, investable and efficient trading zone," she asserted. This statement clarifies the strategic intent: to fortify Africa's economic foundations, making it a more attractive and reliable partner on the global stage, rather than retreating from international engagement.

A Vision for Deeper Integration and Growth

Looking ahead, COMESA harbors ambitious long-term goals for the DRPP. The platform is expected to be a pivotal driver in increasing intra-regional trade from its current approximate 12% of total commerce to a more aspirational target of 20%. This upward trajectory signifies a major upgrade to Africa’s payment architecture, aligning with broader continental aspirations for economic integration and self-reliance.

The Digital Retail Payments Platform represents a monumental leap forward for COMESA. By fostering direct trade in local currencies, it not only addresses immediate operational inefficiencies but also lays the groundwork for enhanced financial stability, economic growth, and greater regional cohesion. As the DRPP gains traction, it is poised to redefine cross-border commerce, empowering businesses, central banks, and the wider populace across Eastern and Southern Africa, solidifying the region's place as a dynamic and innovative force in the global economy.