The Governor of the Central Bank of Nigeria, Olayemi Cardoso, has said the apex bank is finalising a new Payment System Vision 2028 designed to promote innovation, strengthen financial system stability, and expand access to banking services across the country.

Cardoso spoke in Abuja during the Technical Group Meetings of the Intergovernmental Group of Twenty-Four, where he explained that improving cross-border payments is a major part of the plan and that Nigeria has already recorded measurable progress in that area.

He said the central bank simplified Know-Your-Customer and anti-money-laundering rules for small cross-border transactions to make it easier for businesses to use the Pan-African Payment and Settlement System.

According to him, the move has reduced paperwork and made it easier for Nigerian small businesses to receive payments for goods traded within Africa. He also said the bank’s regulatory sandbox now allows fintech firms to test cross-border payment solutions under supervision so that innovation can grow without putting financial stability at risk.

Cardoso explained that Nigeria launched its National Payment Stack in June 2025 as a real-time payment platform built on ISO 20022 messaging that supports multiple currencies and cross-border transactions. He added that stronger anti-money-laundering rules aligned with international standards now require strict dual screening of international payments to reduce risks.

He warned that current global payment systems still create serious challenges for individuals and small businesses trying to participate in international trade. “If people cannot move money easily, affordably, and safely, across towns, borders, and continents, then they cannot fully participate in modern economic life,” he said.

According to the governor, cross-border payments are now central to the global financial system, and inefficiencies increase the cost of remittances, foreign exchange transactions, and trade settlements, especially for developing countries. He said improving payment systems is not only a technical issue but also an economic priority because payment channels play an important role in global financial stability.

He said digital innovation provides a major opportunity to solve these problems through tools such as instant payment platforms, interoperable systems, distributed ledger technology, and reliable digital identity frameworks. These, he noted, can lower transaction costs, speed up payments, improve transparency, and widen access for households and small businesses that have long been outside the formal financial system. He added that properly designed digital systems can also strengthen monetary policy, increase financial inclusion, and reduce informal economic activity when supported by strong governance.

Cardoso said Nigeria’s progress shows that such improvements are possible through deliberate reforms. He explained that the central bank has modernised supervision of payment providers, improved agent banking rules to address money-laundering risks, and strengthened connections between payment channels to improve efficiency.

He said slow and costly cross-border payment systems are limiting opportunities for millions of people, noting that remittance channels currently cost more than six percent on average, settlements can take several days, and strict compliance requirements often shut out small businesses.

The governor said reforms carried out with local and international partners in 2024 removed long-standing obstacles to remittances and introduced new financial tools such as the Non-Resident Nigerian Ordinary Account for family support transfers, the Non-Resident Nigerian Investment Account for diaspora investments, and the Non-Resident BVN platform that allows Nigerians abroad to open and manage accounts digitally. He said remittance inflows now average about 600 million dollars each month and could reach one billion dollars monthly soon.

He added that Nigeria has also taken part in global financial discussions, including fintech engagements during international meetings of the International Monetary Fund in 2025, to help shape emerging global financial standards. According to him, digital reforms have already brought millions of Nigerians into the formal banking system and improved confidence in the financial market, adding that extending these gains across borders is the next step for inclusive growth.

Cardoso said digital cross-border payments are changing global finance by enabling trade settlements in local currencies, creating new financial links among developing countries, reducing dependence on a small number of reserve currencies, and improving the flow of capital across regions. He pointed to ongoing international experiments involving multi-central-bank digital currency platforms as evidence that real-time local-currency settlements are becoming more realistic for developing economies.

He said Africa’s experience with PAPSS shows that regions can build their own payment systems that reduce dependence on foreign correspondent banks, lower costs, and allow instant transactions in local currencies. He noted that such systems are helping regional trade, supporting small businesses under continental trade agreements, and improving economic resilience.

Despite the benefits, Cardoso warned that digital payment systems also carry risks such as currency substitution, exchange-rate volatility, systemic threats from non-bank payment firms, and regulatory gaps. Without coordination, he said, cross-border digital systems could become fragmented, increase costs, and weaken the ability of developing countries to protect their monetary systems.

He said central banks must remain at the centre of payment reforms because they are responsible for financial stability, settlement systems, key financial infrastructure, and public trust. In developing countries, he added, central banks must also support job creation, investment, and real-sector growth through coordinated policies.

Also speaking at the meeting, Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the country is pursuing a domestic revenue drive based on efficiency, transparency, and technology. He said Nigeria plans to raise its tax-to-GDP ratio to 18 percent in the medium term through reforms such as updated tax laws, improved compliance systems, automation, and initiatives like the National Single Window.

Edun said measures including RevOp, Federal Treasury receipts, a Central Billing System, and stopping direct deductions by payment portals are meant to create a fair revenue system that supports economic growth. He added that stronger cooperation among developing countries is necessary in a changing global environment, noting that trade between them remains underused despite its potential to stabilise supply chains and diversify markets.

In her opening remarks, Iyabo Masha, Director and Head of Secretariat of the G-24, said many developing countries are facing shrinking fiscal space because debt servicing is taking up a growing share of government revenue. She cited global data showing that external debt service reached 487 billion dollars in 2023 and warned that rising borrowing costs and investment gaps point to deeper structural financing challenges.

Masha said lower-rated countries still face high borrowing costs despite some easing in global financial conditions and urged policymakers to monitor risks such as renewed inflation shocks, sudden capital outflows, trade fragmentation, prolonged debt restructuring, and declining human capital. She warned that weakening education and health outcomes in some low-income countries could reduce long-term productivity and fiscal sustainability.

She said the theme of the 2026 meeting focuses on promoting sustainable, inclusive and job-rich economic transformation and called on policymakers to adopt strong macroeconomic frameworks, expand domestic revenue, invest in infrastructure and human capital, support climate-related projects, and deepen regional trade partnerships. According to her, these policies directly affect daily life for citizens across major cities in developing countries and will determine whether economies can move from slow growth to lasting development. (The Nation)

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