Sao Tome and Principe: African Development Bank signs $3.2 million loan agreement for upgrade of National Switch payment system
The African Development Bank Group and the government of Sao Tome and Principe have signed a $3.2 million loan agreement to upgrade the country’s National Switch payment system that supports the clearing and settlement of country wide high-value and retail payments.
The upgrade will allow for automatic Real Time Gross Settlement (RTGS) modules and Automated Clearing House functionalities which strengthen the clearing and settlement of payments. Through RTGS, high-value transfers are settled in the Central Bank in real time, reducing liquidity and credit risks within the system. The upgrading will allow for the surge of digital payment, mobile money and other digital services.
The Board of Directors of the Bank approved the loan on 8th March with funds to be disbursed from the Nigerian Trust Fund. The Fund is one of the Bank Group’s arms which assists development efforts of the Bank’s low-income regional member countries requiring concessional financing. This funding will supplement an African Development Fund grant of $2 million made in 2017, to support the country with state-of-the-art Automatic Transfer System (ATS+). The African Development Fund is the Bank’s main concessional lending window.
The agreement was signed on 23rd March 2023 during a brief ceremony attended by Sao Tome and Principe Minister of Planning, Finance and Blue Economy, Ginésio da Mata, and Bank country manager for Angola and Sao Tome and Principe, Pietro Toigo.
Commenting on the signing, Ginésio da Mata said: “This fund will facilitate the financial inclusion of the population and further digitalization of the financial services.’’
Toigo said, ‘’We are delighted with the support of the Nigerian Government and the determination of Sao Tome and Principe to integrate its financial system in the continental and global economy.”