Xtransfer ink MOU to offer cross-border financial services to African SMEs

Xtransfer will make use of Ecobank Group’s network in the continent.

Cross-border trade payment platform XTransfer and Africa’s Ecobank Group have signed a memorandum of understanding of cooperation (MOU) to roll-out cross-border financial services to Africa’s small and medium enterprises (SMEs) engaged in foreign trade.

The collaboration is expected to facilitate trade between China and African countries, according to a press release.

XTransfer will leverage Ecobank's extensive network across Africa, enabling its Chinese clients to collect funds in local African currencies while assisting African SMEs in making payments in their local currencies to negate foreign exchange issues.

In the first 11 months of 2024, China’s exports to Africa rose 1.4% to $160b, whilst imports from Africa rose 6.6% to $107b, according to data from XTransfer and Ecobank Group.

However, SMEs in African countries reportedly still face challenges related to cross-border payments and fund collections.

These include difficulties in opening accounts with traditional banks, a high risk of funds being frozen, difficulties in foreign exchange and related losses, lengthy remittance times and high remittance costs.