Malawian businesses could improve on efficiency and reduce transactional costs on foreign correspondent banking charges by using regional real-time payment systems for imports and exports, the Reserve Bank of Malawi (RBM) has said.
But it seems the private sector under the Malawi Confederation of Chambers of Commerce and Industry (MCCCI) is not aware on the usage of both Regional Payments and Settlement System (Repss) and Sadc Integrated Regional Electronic Settlement System (Siress) and its benefits to their businesses and wider economy.
Malawi went live on Repss and Siress on November 19 2013 and April 14 2014 respectively, but MCCCI public private dialogue manager Hope Chavula admitted the private sector is unaware of the two systems.
He, however, said that from the look of things, the systems could go a long way in reducing unnecessary costs for businesses.
Under Siress, whose transaction currency is South African rand, all the country’s commercial banks, representing 92 percent, are live except FMB while in repss, which uses dollars and euros, all the banks are connected.
Todate, figures show that $313.7 million (K156.8 billion) has been transacted through Siress in Malawi against a regional transaction of $240.4 billion (K120 trillion), according to RBM figures.
Nine out of 13 countries in Sadc are transacting through Siress, representing 69 percent with Angola, Botswana, Mozambique and the Democratic Republic of Congo (DRC) not live on the payment system.
In contrast, only five countries, Malawi, Mauritius, Uganda and Rwanda out of 20, went live on Comesa’s Repss, but there are indications that five central banks are now ready to go live on the platform.
However, there have been no transactions settled via Repss in the second quarter [April to June] of 2014 region-wide and, as at now. There have also been no transactions settled via Repss in Malawi, said RBM manager for research and compliance Smith Kamwana.
Repss and Siress are aimed at facilitating trade among countries in the Common Market for Eastern and Southern Africa (Comesa) and Southern African Development Community (Sadc) trade blocs, he said.
The central bank has since asked the business community and the public to start using these two payment systems by demanding to transact on them.