by SAVIOUS KWINIKA
JOHANNESBURG, (CAJ News) – IN a development that could accelerate the restructuring of global payments infrastructure, Standard Bank has become the first African financial institution authorised to provide cross-border transactions via China’s Cross-Border Interbank Payment System (CIPS).
The move, celebrated at the South African Reserve Bank (SARB) this week, signals a deepening financial corridor between Africa and the world’s second-largest economy—and, according to many geopolitical analysts, an emerging challenge to the decades-long dominance of the U.S. dollar in international trade.
CIPS, launched by the People’s Bank of China (PBOC), enables global banks to clear and settle payments directly in Chinese Renminbi (RMB).
While the platform has grown steadily across Asia and Europe, Africa’s onboarding marks a strategic milestone.
Standard Bank—the continent’s largest lender by assets—received its licence in June at the Lujiazui Forum in Shanghai.
Now live, the system will allow African corporates to transact with Chinese partners without routing payments through dollar-based intermediaries.
The inauguration ceremony in Pretoria was attended by SARB Governor Lesetja Kganyago, PBOC Governor Pan Gongsheng, and CIPS Chairman Wang Hongbo.
All three leaders underscored the transformative implications for Africa-China commerce.
With China already accounting for 34% of imports among surveyed African businesses in Standard Bank’s Trade Barometer 2024, the demand for faster, cheaper, and politically neutral settlement rails has become unmistakable.
For decades, the global financial system has operated through U.S.-centred payment channels such as SWIFT and dollar-denominated correspondent banking.
However, economists note that an increasing number of countries have been diversifying away from dollar dependence—driven partly by concerns that U.S. and EU sanctions, often extraterritorial in nature, give Western governments disproportionate leverage over other states’ economic sovereignty.
Cases frequently cited by international policy scholars include Iran, whose banking sector has repeatedly been cut off from global payment networks; Russia, which faced sweeping financial sanctions after 2014 and again in 2022; and Venezuela, where restrictions impaired government access to foreign reserves.
African governments have also long complained of “secondary sanctions” that discourage banks from dealing with countries like Zimbabwe or entities involved in trade with sanctioned partners—even when those transactions are legal under local law. Many emerging economies argue that such measures, irrespective of intent, create vulnerabilities and heighten the risk of being locked out of global markets.
Against this backdrop, CIPS offers an alternative infrastructure that is insulated from Western jurisdiction and built around China’s rising role in global trade.
By enabling direct RMB settlement, countries can reduce currency-conversion costs, bypass U.S. correspondent banks, and mitigate exposure to geopolitical risk.
Standard Bank’s adoption of CIPS is more than a technical upgrade. It signifies Africa’s willingness to integrate with a multipolar financial architecture.
As Crosby Mkhwanazi, Head of Client Coverage at Standard Bank Corporate & Investment Banking, explained:
“We are keen advocates for Africa’s growth, and this new service is tailored to provide solutions that meet our clients’ needs where they operate.”
With China already Africa’s largest export market—absorbing everything from minerals to agricultural goods—CIPS is poised to accelerate transaction clearance times, reduce costs, and improve predictability for traders.
Faster settlement could also unlock greater SME participation in cross-border commerce, long hampered by cumbersome dollar-based procedures.
While CIPS is still far smaller than SWIFT, analysts say its rapid expansion is emblematic of a global reconfiguration.
As more countries experiment with local-currency settlement systems—from India’s rupee-based trade arrangements to Gulf states exploring non-dollar oil contracts—the dollar’s unquestioned dominance is beginning to soften at the margins.
For Africa, Standard Bank’s pioneering step not only diversifies its financial options but situates the continent at the centre of a shifting global payments landscape—one in which power is no longer monopolised by a single currency, but shared across an increasingly interconnected, technologically sophisticated, and geopolitically plural world.
– CAJ News