Absa Bank has called for accelerated digitisation and stronger interoperability across Africa’s trade ecosystem to reduce trade finance costs and unlock economic growth opportunities across the continent.
Speaking during the GTR Conference in Nairobi, Lydia Wangari-Karanja, Director of Transactional Banking at Absa Bank Kenya, said Africa’s trade finance systems remain heavily reliant on paper-based processes, leading to inefficiencies, delayed trade flows and higher operational costs.
Paper-Based Trade Processes Slowing Growth
According to Wangari-Karanja, micro, small and medium-sized enterprises (MSMEs), which form the backbone of many African economies, are among the most affected by manual trade processes.
She noted that multiple manual handoffs across the trade lifecycle, coupled with limited visibility for banks and clients, continue to make trade more expensive and less efficient.
“Trade by nature remains highly paper-intensive, particularly in markets like Kenya, where MSMEs form the backbone of economic activity. Across the trade lifecycle, there are multiple manual handoffs with limited visibility for both banks and clients, and these inefficiencies ultimately make trade more expensive,” Wangari-Karanja.
Digitisation to Improve Efficiency and Lower Costs
Absa said digitisation presents a major opportunity for businesses and financial institutions by enabling faster financing, improving transaction visibility and reducing supply chain cycle times.
The bank noted that digital systems can also help lower demurrage costs and operational friction while improving turnaround times across trade systems.
Wangari-Karanja said businesses stand to benefit significantly from faster access to financing and more efficient movement of goods across borders.
“For clients, digitisation means faster access to financing and trade processing, reduced supply chain cycle times, lower demurrage costs and improved transaction visibility. Ultimately, time is money, and digitisation helps businesses move goods and access financing more efficiently,” she said.
Focus on Interoperable Trade Ecosystems
Absa emphasised that the future of trade finance goes beyond digitising paper documents and requires the development of interoperable ecosystems connecting banks, regulators, customs authorities, ports, development finance institutions and corporates.
The bank said collaboration among stakeholders will be critical in strengthening trust, efficiency and transparency within Africa’s trade environment.
East Africa Positioned as Key Trade Hub
As a pan-African financial institution operating in 12 African markets with representative offices in Beijing, London, New York and Dubai, Absa said it remains committed to supporting trade flows that enhance regional integration and economic resilience.
“At Absa Bank, we believe that East Africa remains strategically positioned to become one of the continent’s leading industrial and trade hubs, supported by growing regional integration, infrastructure development and digital transformation.” she added