EAC and IGAD Forge Alliance to Unify Cross-Border Digital Payments in Eastern Africa

 

“Digital transformation is no longer a choice but a necessity. Together, IGAD and EAC can build a digitally integrated Eastern Africa, where borders no longer limit opportunity, and where innovation drives inclusion, and prosperity is shared.”

— Dr. Mohyeldeen Eltohami, Director of Economic Cooperation and Regional Integration, IGAD

In a landmark step towards deepening regional financial integration, the East African Community (EAC) and the Intergovernmental Authority on Development (IGAD) convened a high-level five-day workshop on digital payment system interoperability, with support from the World Bank.

Held in Addis Ababa, Ethiopia from June 30 to July 4, 2025, the workshop brought together central banks, digital finance experts, and senior policymakers from nine countries under the framework of the Eastern Africa Regional Digital Integration Project (EARDIP)—a joint initiative by EAC and IGAD aimed at strengthening the digital economy across borders.

Regional Fragmentation: A Shared Challenge

At the heart of discussions was a critical issue: fragmented, non-interoperable payment systems that limit regional trade, remittances, and financial inclusion.

While countries like Kenya, Tanzania, and Ethiopia have made significant progress in domestic digital payments, regional systems remain disconnected due to regulatory inconsistencies, technical disparities, and cybersecurity vulnerabilities.

“The collaboration between EAC and IGAD exemplifies the spirit of regional solidarity and shared ambition that Africa needs to build the future it envisions—a future of seamless digital integration, inclusive prosperity, and economic transformation,” said Dr. Mohyeldeen Eltohami, IGAD’s Director of Economic Cooperation and Regional Integration.

He emphasized that this was more than a technical workshop, calling it a launchpad for transformation.

“Let cooperation, not fragmentation, define the region’s digital future,” he urged.

Digital Payments: Backbone of a Connected Economy

Echoing Dr. Eltohami’s vision, Eng. Daniel Murenzi, Principal Information Technology Officer at the EAC Secretariat, stressed the centrality of payment systems in enabling a unified digital economy.

“EAC and IGAD are implementing the EARDIP Project with the objective to advance digital regional integration by strengthening cross-border digital infrastructure, services, policies, and frameworks that promote economic growth, inclusion, and regional collaboration among EAC and IGAD Member/Partner States,” said Eng. Murenzi.

He added:

“Payment systems are an enabler in this digital ecosystem for the region, with their interoperability a critical factor. We therefore need to review national payment processes, harmonise legal and regulatory instruments and facilitate interoperability of the region’s payment system.”

Global Support and Alignment with G20 Goals

Mr. Gynedi Srinivas, Senior Financial Sector Specialist at the World Bank’s Payment Systems Development Group, underlined the global importance of the initiative.

“The benefits of cross-border interoperability of fast payment systems will especially enable safer, faster, and low-cost retail payments across borders, helping end-users, individuals, and Medium, Small and Micro Enterprises (MSMEs) to make and receive payments seamlessly,” he said.

Srinivas further pointed out that the workshop aligns with the G20 roadmap for enhancing cross-border payment efficiency and affordability.

Strategic Focus and Key Recommendations

Workshop sessions focused on three core areas:

1. Digital Infrastructure

2. Legal and Regulatory Harmonization

3. Regional Payment System Integration

Recommendations included:

• Investing in shared digital infrastructure

• Adopting consumer-centered FPS design

• Developing regulatory sandboxes to support innovation

• Harmonizing legal instruments to unlock seamless cross-border operations

Experts also explored emerging technologies such as AI, blockchain, and central bank digital currencies (CBDCs). Discussions addressed cyber threats and emphasized the importance of Cybersecurity Incident Response Teams (CIRSTs) and real-time intelligence sharing across borders.

Toward a Unified Digital Future

Participants called for continued cooperation through:

• Annual joint workshops on cross-border payments

• Peer-to-peer attachments among central banks

• Designing payment systems based on user needs

• Joint efforts to tackle social engineering risks, especially in mobile payment environments

“Interoperability is not a luxury; it’s a necessity,” reiterated Eng. Murenzi, stressing that the region cannot afford to delay its digital transformation.

Diverse and Expert Participation

The workshop featured representatives from the National Payment System departments of the following central banks:

• Bank of the Republic of Burundi

• Central Bank of Djibouti

• National Bank of Ethiopia

• Central Bank of Kenya

• National Bank of Rwanda

• Central Bank of Somalia

• Bank of South Sudan

• Bank of Tanzania

• Bank of Uganda

The Central Bank of the Democratic Republic of Congo was represented by the Ministry of Regional Integration. Also present were World Bank consultants, EARDIP project coordinators, and a representative from Banco d’Italia (Bank of Italy).

As digital technologies rapidly evolve, the EAC-IGAD partnership—through EARDIP—marks a transformative step toward making seamless, secure, and affordable digital payments across borders a reality.

“Together, we can build an Eastern Africa where digital borders are erased, innovation is encouraged, and prosperity is shared by all,” concluded Dr. Eltohami.