Arusha, Tanzania — July 11, 2025 — The East African Legislative Assembly (EALA) has today adopted a motion emphasizing the urgent need to modernize, harmonize, and interconnect payment and settlement systems across the East African Community (EAC). This follows the recommendations from the East African Community Capacity Building Workshop on the Payment and Settlement Systems Integration Project (EAC-PSSIP), held in Kampala from November 25th to 29th, 2024, supported by the African Development Bank (AfDB) and aimed at advancing regional financial infrastructure to support economic integration.
The committee’s report and the subsequent motion underscored that a unified, efficient, and resilient financial system is fundamental to facilitating seamless cross-border payments, enhancing financial stability, and achieving the goals of the East African Monetary Union Protocol, which aspires to establish a single currency by 2031. Since the initiation of the project in 2014, with support from the African Development Bank (AfDB), efforts have been directed at addressing fragmentation in national payment systems through key components such as regional integration of financial market infrastructures, legal harmonization, and stakeholder capacity enhancement.
In its deliberations, the Assembly highlighted the importance of establishing “robust and harmonized legal frameworks that underpin safe and inclusive cross-border transactions”. Members emphasized that “regional cooperation in AML/CFT (Anti-Money Laundering and Countering the Financing of Terrorism), interoperability protocols, dispute resolution mechanisms, and oversight functions are critical to building trust and resilience across our financial landscapes”. The Assembly unanimously adopted the motion aimed at creating a legal environment conducive to a secure and efficient regional payment system.
As was also highlighted during the workshop in Kampala, the Assembly acknowledged the role of mobile money in expanding financial access and agreed with sentiments “mobile money has revolutionized financial inclusion, providing accessible and secure transaction channels, especially for underserved populations”. Regulatory considerations discussed included licensing, consumer protection, AML/CFT compliance, data privacy, cybersecurity, and the importance of regulatory sandboxes to foster financial innovation—vital measures to ensure the security and transparency of digital payments.
The Assembly deliberated on the report on the importance of international standards such as the Principles for Financial Market Infrastructures (PFMIs), which promote stability, efficiency, and risk reduction as advised by experts from the Central Bank of Kenya emphasizing that “harmonizing legal frameworks for settlement finality, netting arrangements, and enforceability of contracts is essential to foster trust and consistency across member states”.
The Assembly also noted the challenges related to financial crimes, including money laundering and terrorism financing, and agreed with the report that “strengthening AML/CFT measures, such as transaction monitoring and legal harmonization, is crucial to safeguarding our financial ecosystem” and that “persistent gaps, like enforcement discrepancies and cross- border legal limitations, threaten the progress of our regional integration efforts”.
Emerging topics such as Central Bank Digital Currencies (CBDCs) and the role of FinTech were also examined as were highlighted during the workshop in Kampala by James Bukulu of the Bank of Uganda highlighting that “regulatory sandboxes and passporting arrangements have the
potential to accelerate the adoption of innovative payment solutions across our diverse markets”.
The Assembly endorsed the Recommendations from the motion as follows:
• Developing and implementing harmonized legal and regulatory frameworks to support
integrated payment systems.
• Providing ongoing capacity building for legislators and regulators.
• Strengthening consumer protection, transparency, and dispute resolution.
• Establishing regulatory sandboxes to encourage innovation and mitigate risks.
• Promoting regional cooperation for AML/CFT enforcement.
• Standardizing interoperability protocols and licensing frameworks under existing legal instruments such as the Treaty, the Common Market Protocol, and the Monetary Union Protocol.
NOTE: However, the Assembly deferred to tomorrow Saturday 12th, July 2025 the following reports for debate.
1. The reports of the Committee on Agriculture, Tourism, and Natural Resources (ATNR) on Agro-Ecology within the EAC region; and
2. The report concerning the investigation of allegations leveled against the immediate former Secretary General, as presented on March 6th and 12th, 2024. (Deferred to Saturday, 12th July, 2025 for debate).
The Assembly reaffirmed that “a secure, innovative, and harmonized payment infrastructure is the backbone of our economic integration and financial stability”. It called upon all Member States, regulators, and stakeholders to actively collaborate in implementing these recommendations to ensure the region’s financial ecosystem is resilient, inclusive, and positioned to benefit from digital advancements and global financial integration.
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Nicodemus Ajak Bior
Senior Public Relations Officer (SPRO)
East African Legislative Assembly
Arusha, Tanzania
Tel: +255-768-885-633 / +254-729-157-207
Email: nbior@eachq.org
www.eala.org
