Cross-border payments between Group of 24 Nations (G-24) members are too expensive and slow, according to Mr. Olayemi Cardoso, governor of the Central Bank of Nigeria (CBN).
According to him, cross-border payments are still too expensive, too slow, and too dispersed, particularly for developing nations. Millions of people are still deprived of global opportunities due to global remittance lanes costing more than 6.0 percent, settlement delays of several days, and regulatory requirements that exclude MSMEs.
He advocated for swift action to address the issues through contemporary digitization that would make such payments quicker and less expensive while giving the keynote presentation at the Group’s ongoing Technical Group Meeting in Abuja yesterday.
Mr. Cardoso stated that his keynote address on “Digital Cross-Border Payments, Global Finance, and Economic Transformation – Opportunities and Risks” was a core development objective for G-24 nations rather than just a technical discussion.
He praised Mr. Edun, the G-24 Chair and Minister of Finance and Coordinating Minister of the Economy, for outlining a G-24 strategy centered on modernizing global finance, bolstering domestic capabilities, and making sure the digital revolution becomes a driver of shared prosperity.
“These priorities are in line with the mandate of central banks throughout the G-24,” he said.
“Cross-border payments are becoming the backbone of the international monetary and financial system worldwide,” the CBN chief continued. Higher remittance costs, expensive foreign exchange transactions, disjointed settlement procedures, and obstacles to MSME involvement in international trade are all direct results of inefficiencies in these systems for G-24 economies.
Therefore, enhancing cross-border payments is a macroeconomic and development priority rather than just a technical reform. The routes that carry trade, capital, and remittances are now an essential component of the architecture of global financial stability.
Now, digital innovation offers a once-in-a-lifetime chance to resolve these conflicts. Interoperable digital platforms, distributed ledger technology, instant payment systems, modern payments infrastructure, and strong digital identity frameworks can all lower transaction costs for trade and remittances, speed up settlement times, and increase transparency, compliance, and auditability.
He gave the excellent example of India’s Unified Payments Interface (UPI), which is currently connected to Singapore and the United Arab Emirates and has reduced remittance costs and made it possible for everyone to use it.
Building on the existing reforms, Mr. Cardoso stated that the CBN was wrapping up work on the new Payment System Vision 2028, which was created in close coordination with industry stakeholders and centered on five strategic priorities meant to promote financial inclusion, increase innovation, and fortify system resilience. Improving the cross-border payments environment is a key component of this strategy, and Nigeria has achieved noticeable, quantifiable progress in this area.
Edun issues a debt crisis warning.
Relying on expert assessments, Mr. Edun cautioned in his speech that roughly half of low-income nations were in or near debt trouble, necessitating immediate action because debt payment has grown to be a significant burden for many Global South nations.
He pointed out that the overall yearly debt service payments made by South African debtor nations greatly outstripped both foreign direct investment and overseas development assistance flows from the Global North.
“At a time when global risks are converging faster than institutions can respond, the gathering was an opportunity to re-shape the development trajectory of the Global South,” Mr. Edun said.
Additionally, the minister pointed out that around 25% of EMDEs have lost access to global finance markets, making domestically produced income more attractive than before.
Members have little financial resources—Masha
Dr. Iyabo Masha, Director and Head of the G-24 Secretariat, stated earlier in her remarks that the talks were not only important but also necessary because the summit was taking place during a period of increased uncertainty, policy fragmentation, and structural change.
“We meet at a time when the global economy is characterized by measured resilience but limited ambition,” she said. In a more volatile environment, many EMDEs now face the challenge of restoring development trajectories, safeguarding macroeconomic stability, and financing transformation rather than just “recovering.”
“I want to focus on five subjects today: There are near-term concerns beneath the surface; there are policies necessary for transformation in the medium term; the global picture is steady but subject to diverging influences; and the policy space for EMDEs is becoming more constrained. Lastly, there has never been a greater need to restructure the Bretton Woods institutions.
The Director pointed out that member countries’ vulnerability were exacerbated by their limited fiscal space.
The degree to which expanding fiscal-financial ties are severely limiting fiscal flexibility in many EMDEs, with debt service now taking up a larger portion of government revenues, is one key result, she said.
Public investment in many developing nations is still below what is required to meet basic infrastructure and climate goals, according to the World Bank’s Global Economic Prospects report. This means that present investment deficits will probably lead to slower potential growth in the future.
Countries are required to manage debt loads, safeguard social expenditures, invest in climate resilience, improve human capital, and consolidate their budgets all at once in the face of these problems.
“These would be challenging to do since, according to UNCTAD, many developing nations devote a significant portion of their export earnings to servicing their external debt, which has high and growing costs. In 2023, external debt service is expected to exceed $487 billion. As debt, development, and stability converge, this suggests a more profound, structural financing gap.
