BANK transactions across East Africa will now be done in real time following the implementation of the East Africa Payments System championed by regional central bank governors.
The system is expected tol improve cross border payments among banks and will also enable the transfer of large sums of money, same day settlements and improved risk control, the Central Bank of Kenya said in a statement.
"Currently EAPS integrates with the respective real time gross settlement systems of Kenya, Uganda and Tanzania that utilise internationally recognised Swift messaging network for safe and secure delivery of payment and settlement messages," said CBK yesterday.
Swift - Society for Worldwide Interbank Financial Telecommunication - provides a network that enables financial institutions worldwide to send and receive information about money transactions in a secure and standardised environment. Swift also sells software and services to financial institutions.
"Commercial banks in Rwanda and Burundi are expected to join later," CBK said.
The bank added that the system will be a "big win" for the East African Community especially in promoting intra-regional trade. Transactions will be carried out in any of the EAC currencies, a move that will boost many regional businesses by eliminating the need to carry hard cash around.
"The implementation of the EAPS addresses deficiencies in the current cross border payment methods through enhanced efficiency and risk controls," CBK added.
The EAPS is part of a wider plan to interlink commercial banks in the Comesa region.