Crown Agents Bank’s Claire Gates shares insights on cross-border payments in Africa, the role of stablecoins, and the future of AI in payments.
In the latest episode of the Payment Expert Podcast, Claire Gates, Global Head of Payment Solutions at Crown Agents Bank, explains why Africa’s cross-border flows can be a “quite complicated” situation.
She told host Louis Thompsett, News Editor for Payment Expert, that many consumers have evolved into needing instant settlements, which is where innovation in cross-border payments in Africa is happening.
This is primarily due to the advancements of digital payments across the continent, but innovation on the operator’s end still comes into friction points pertaining to how the cross-border payment is processed.
There are many localised and national payment rails across Africa, plenty of intermediary banks too, whilst foreign exchange (FX) rates also add a level of friction that hinders instant money movement across borders.
“Ultimately, we also have to check the money that has been spent is going into the right wallets to ensure no money laundering, KYC, the screening of it,” added Gates.
“All of that involves many different parties having a role. This can be quite a complicated situation.”
Crown Agents Bank has served as a corresponding bank in Africa for several years, processing many of these cross-border payment steps many of the global traditional banks may be unwilling to do.
“That’s what Crown Agents Bank does really well” said Gates on catering to slightly riskier markets in Africa.
“We have been in the region for just short of 200 years,” she said. “We were there helping with corresponding banking, banking services, FX for markets that historically, many of the traditional big banks did not want to go near, and then we have evolved our product proposition accordingly.”
Stablecoins opening instant liquidity
Stablecoins have often been viewed as a cross-border remedy to many of its friction points, with one of the most prominent use cases being the access to instant liquidity.
Processed on blockchain networks, stablecoin payments offer near-instant settlement alongside access to funds which would typically take days for a recipient to receive.
Gates reinforces the benefits of stablecoin liquidity but mentions how on/off ramping of stablecoin conversions could be a potential barrier for banks.
“Why stablecoins will be particularly interesting is its ability to send liquidity into markets really quickly, rather than taking a few days to be sent from one bank to another bank… it does it almost immediately 24/7,” said Gates.
“The ultimate solution is to be able to off-ramp it. Making sure local banks accept it, can use it, can be part of the ecosystem, and then also be able to off-ramp it into the fiat currency the individual will want in their wallet.”
Is Africa ready for agentic payments?
Another innovation that is currently sweeping through the payments landscape is AI agents performing payment functions on behalf of the consumer, also known as agentic payments.
Gates revealed that mature African markets, like Nigeria, which often rely on legacy systems may be slower to adopt agentic payments. Whilst in technology-savvy markets like in Kenya for instance, they can enact on the wave and go to market quicker with agentic solutions.
“I see this being really key for (emerging markets) being able to accelerate development and capabilities quicker and less expensive than others,” said Gates.
When asked whether Crown Agents Bank is currently working on delivering agentic solutions, Gates said: “Absolutely, we are using this for optimising flows, optimising screening, name checks in a particular market.”
Gates previously spoke to Payment Expert for its Settled Up series.
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