Harness the untapped potential of digital payments in East Africa trade
This story has significance for readers across Kenya and beyond.
A container travelling from the Port of Mombasa to Kampala still leaves behind a long paper trail of invoices, multiple payment gateways and days of reconciling fees between clearing agents, transporters and banks. The result is tied-up working capital, limited transparency and higher costs that are eventually passed on to consumers.
This challenge dominated discussions at the recent East Africa Logistics, Warehousing and e-Commerce Conference and Expo in Nairobi, where policymakers, industry leaders and innovators agreed on one thing: East Africa’s supply chains have reached a turning point, and artificial intelligence (AI) and digital finance can help remove long-standing inefficiencies.
Today, a clearing agent in Nairobi tracking payment for a shipment to Kampala may have to navigate mobile money, bank transfers and informal payment channels while hoping funds arrive before customs clearance deadlines. Delays increase costs and disrupt the movement of goods.
Digitisation offers a better alternative. Real-time digital payments create an auditable trail from sender to receiver, reducing delays and improving accountability across the supply chain.
AI is making these systems even more effective. AI-powered risk assessment can shift fraud detection from a reactive process to proactive compliance.
Machine learning models can automate payment reconciliation, identify anomalies and reduce costly human errors. When shipment documentation is automatically matched with payment records, customs clearance can happen much faster, helping goods move more efficiently across borders.
Governments and logistics agencies across the region are also accelerating digital adoption through digital trade platforms and interoperable payment systems.
At the same time, logistics companies are using AI to optimise delivery routes, forecast demand and turn operational data into business insights. The convergence of logistics and fintech is transforming not only how goods move, but also how money flows through regional trade.
Experience across Kenya, Tanzania, Zambia and South Sudan shows that connecting banks, mobile money providers and customs systems through a single digital payment rail can transform operations.
Verified transaction histories improve access to working capital, standardised fee structures reduce informal undercutting, and shared digital records give transporters, clearing agents, lenders and regulators a transparent view of every transaction.
For this transformation to succeed, it must include the small and medium-sized businesses and cross-border traders that drive regional commerce. Digital payment systems must be simple, interoperable and affordable so they work for businesses of every size.
Simba J. Huni is the Global Business Development Manager at CapitalPay International
Reporting originally appeared via Business Daily. Read the full source for additional context.