By Azam Tariq

China's Cross-Border Interbank Payment System (CIPS) is gaining ground across Africa as more banks expand renminbi settlement services, offering faster cross-border transactions and greater payment flexibility for developing economies, with experts highlighting potential benefits for Pakistan's trade and investment.

Ecobank Group has signed a memorandum of understanding (MoU) with CIPS, while Standard Bank Group has expanded connectivity across Kenya, Tanzania, Uganda, Ghana and Namibia. Bank of Kigali has also joined as a direct participant, with lenders in Ghana and Angola expected to follow.

Standard Bank says payments through the system can now settle within minutes rather than days across several African markets, demonstrating the potential of improved financial connectivity to facilitate international commerce.

The expansion comes amid growing economic engagement between China and Africa. China has extended zero-tariff treatment to 53 African countries with which it has diplomatic relations, while China-Africa trade reached $348 billion in 2025, increasing 17.7% year on year, according to data from China's General Administration of Customs.

Speaking to Wealth Pakistan, Nabila Jaffer, Senior Research Analyst and Head of the China Program at the Institute of Regional Studies, said CIPS was providing an additional secure payment option for international trade, allowing developing economies to diversify their financial arrangements.

She explained that SWIFT remained dominant in international financial messaging, but its role in implementing sanctions-related restrictions on countries, including Iran and Russia, had encouraged many developing economies to explore alternative payment channels.

"CIPS gives more options for international trade," she said, adding that its expansion in Africa could pave the way for Global South countries to diversify their financial dealings.

Jaffer said the wider adoption of CIPS could support the broader trend towards reducing dependence on the US dollar by enabling countries to conduct more international trade directly in local currencies or renminbi.

She noted that Pakistan could benefit significantly from improved payment connectivity because the China-Pakistan Economic Corridor (CPEC) had already strengthened economic and institutional cooperation between the two countries.

Greater use of CIPS and renminbi settlement could facilitate Chinese investment, reduce transaction delays and strengthen business-to-business and government-to-government economic interaction, she said.

Jaffer also highlighted potential benefits for Pakistan's trade with Iran, particularly through the development of formal and traceable payment channels where legally permissible.

She said banking transactions linked with invoices, customs declarations and border documentation could provide regulators with greater visibility over the movement of goods and funds, supporting efforts to bring more border trade into documented channels and curb smuggling.

Haris Bilal Malik, Research Fellow at the China-Pakistan Study Centre at the Institute of Strategic Studies Islamabad, told Wealth Pakistan that CIPS was becoming increasingly important as China expanded its economic engagement with countries across the Global South.

He said the system's growth, alongside BRICS cooperation and China's zero-tariff initiative for African countries, had increased its relevance in international trade and financial connectivity.

"Pakistani traders are already conducting business through the Khunjerab-Sost route, and improved payment mechanisms could make such trade faster and more efficient," Malik said.

He explained that easier settlement arrangements could strengthen business-to-business, government-to-government and people-to-people linkages between Pakistan and China while supporting growth in bilateral trade.

Improved cross-border payment infrastructure could also help businesses reduce transaction friction and make international commercial dealings more efficient, particularly where trade and investment relationships were already expanding.

For Pakistan, wider use of renminbi settlement could support Chinese investment, facilitate cross-border commerce and help formalise regional trade through more transparent financial channels.

Africa's growing adoption of CIPS illustrates how expanding trade relationships and improved payment connectivity can reinforce each other, offering developing economies additional opportunities to strengthen financial cooperation and diversify international settlement arrangements.

Credit: INP-WealthPk