Infosys manager says Africa fintech must tackle fragmented payment rails

Africa’s fintech sector has brought millions of users into formal finance through mobile money, wallets, agent networks and payment platforms, according to Rajeew Vishvakarma, a project manager at Infosys. He said the next economic constraint is interoperability: the ability of wallets, banks, merchants, identity systems and cross-border rails to work together without adding cost or delay.

In a Finextra community commentary, Vishvakarma argued that payment adoption alone no longer defines maturity in African digital finance. His assessment places the market impact on operating costs, merchant acceptance, remittances, credit data and regional trade, all of which can be limited when payment systems grow as separate networks.

Fragmentation raises operating friction

Vishvakarma said early fintech growth across Africa often relied on proprietary networks built to acquire users and expand quickly. As those networks scale, he said closed systems can create weak wallet-to-wallet transfers, limited links between banks and wallets, complicated merchant acceptance and gaps in regulatory visibility.

For merchants, fragmentation can mean maintaining several payment channels and handling separate settlement processes. Settlement is the stage after a payment is made when funds are reconciled and moved between providers. If that process is not unified, a merchant may receive value through different routes, at different times and with different fees or operational requirements.

Vishvakarma said the costs extend beyond user experience. He linked more connected systems to lower acceptance costs, wider merchant participation, stronger consumer safeguards, improved credit histories and more efficient trade.

The layers that need to connect

The interoperability challenge is not confined to one technical link, according to Vishvakarma. He described several layers that need common rules, trusted connections and clear accountability.

• Wallet-to-wallet connections, allowing transfers between different providers.
• Bank-to-wallet links, connecting regulated banks and fintech platforms within one operating system.
• Merchant acceptance, so businesses can take digital payments from several platforms without complex back-office processes.
• Identity and know-your-customer systems, reducing repeated onboarding while protecting privacy.
• Cross-border payment rails, covering currency exchange, settlement, compliance and regulatory requirements.

He said stronger systems also require cybersecurity, fraud monitoring, consumer protection and dispute-resolution processes. Greater connectivity can increase value, but Vishvakarma said it can also allow fraud or technical failures to spread faster if controls are weak.

Regional payment rails move into focus

Cross-border payments are central to the argument because regional commerce depends on fast and affordable movement of money. Vishvakarma cited the Pan-African Payment and Settlement System, or PAPSS, as an example of regional infrastructure designed to support payments between African countries, local-currency exchange and reduced reliance on external currencies such as the US dollar.

He said the goal is not to exclude global payment networks, but to give African businesses and consumers payment routes that are more local and efficient. The commentary also cited Reuters reports on PAPSS plans for a foreign-exchange market platform, a COMESA digital payments system, and a cross-border transfer platform launched by FNB and Mastercard.

Vishvakarma said banks, fintechs, regulators and investors each have distinct roles. He argued banks need to connect with wallets, merchants and regional infrastructure; fintechs need standards-based operations; regulators need rules on liability, security and consumer protection; and investors are likely to pay more attention to infrastructure layers such as switches, APIs, fraud controls, identity verification and settlement.

This story draws on original reporting from Finextra Research.