The Real AfCFTA Gap Isn’t Trade, It’s Trust

AfCFTA Needs a Data Rail: Why African SMEs Need a Data Passport

AfCFTA’s big promise is simple: an African business in Accra should be able to sell into Lagos, Nairobi and Abidjan almost as easily as into Osu or East Legon.

We’ve started moving. Intra-African trade has risen to about $192 billion, roughly 15% of Africa’s total trade in 2023, up from 13.6% the year before, progress, but still far below intra-Asia (≈60%) and Europe (≈68%). (Afreximbank Media)

On the payments side, the Pan-African Payment and Settlement System (PAPSS) is live in 17 countries, connecting 14 national switches and over 150 banks to support real-time cross-border payments in local currencies. (PAPSS)

So the trade highway and the payment rails are slowly taking shape.

But if you zoom in on the typical SME, something important is missing.

The pan-African SME with a local credit score

Meet Ama (composite, but very real).

• In Accra, she sells cosmetics via mobile money tills, POS, and bank transfers.
• In Lagos, she ships through a marketplace that settles in naira via card rails.
• In Abidjan, a distributor pays her through occasional cross-border transfers and sometimes cash.

Ama is exactly the kind of pan-African trader AfCFTA is supposed to unleash.

Yet:

• Her Ghanaian bank only sees GHS inflows and treats her like a local micro-SME.
• The Nigerian PSP sees fragmented NGN card receipts and tags her as a side-hustle merchant.
• The Ivorian bank sees an odd foreign transfer from Ghana, nothing more.

The reality of her trade is pan-African.
The reality of her data is three disconnected fragments.

And in a world where data is becoming the new collateral, that fragmentation matters.

Data is already collateral – just not for the SME

Across the continent, we already have live proof that transaction data = credit.

• In Kenya, M-Shwari uses a customer’s M-Pesa usage history (savings and transaction patterns) to build a credit score and issue instant loans from as low as KES 1,000, entirely via mobile. (CGAP)
• Kopo Kopo plugs merchants into Safaricom’s Lipa Na M-Pesa tills, and then offers cash advances up to KES 10 million based explicitly on the merchant’s payment volumes over at least two months.
• B2B e-commerce player Wasoko has onboarded over 50,000 informal retailers across six countries and fulfils millions of orders; it now provides “Pay Later” inventory financing based on retailers’ purchasing history and sees repayment rates above 99% on more than $20 million of working-capital loans disbursed in a year.
• Embedded-finance startup Pezesha has over 200,000 registered SMEs and more than 400,000 loans issued; in Kenya and Uganda it scores SMEs partly on mobile money and digital transaction histories, and it has now partnered with Pesapal in Uganda to offer “data-driven credit” to small businesses on that payment platform.

These are not pilots. This is mainstream:

• Every till payment, POS swipe, QR scan and mobile money inflow is already being converted, somewhere, into a risk decision and a credit limit.

But notice where the power sits:

• Safaricom and its banking partners own the M-Shwari models and data.
• Kopo Kopo holds the merchant data that drives its cash-advance product.
• Wasoko and MaxAB are now explicitly repositioning as fintech-led B2B platforms, because the upside sits in embedded finance powered by retailer data, not just in moving boxes on trucks.
• Pezesha and similar lenders are building proprietary credit scores and risk engines on top of SME transaction trails. (pezesha.com)

In other words: The collateral technology that finally works for African SMEs already exists, but it lives in multiple private silos, each optimised for its own balance sheet.

Ama’s data is collateral today… just not collateral she can carry.

Open banking is plumbing. SMEs still need a product.

At this point, a regulator or banker will ask: “Isn’t this exactly what open banking or open finance is supposed to solve?” Partly.

Nigeria, for example, has issued a Regulatory Framework for Open Banking (2021) and detailed Operational Guidelines (2023) that set principles for customer-permissioned data sharing across banks and payments providers, with an open banking registry planned at the Central Bank. (Central Bank of Nigeria)

Other countries (Kenya, South Africa, Ghana) are on similar journeys.

But open banking, as currently implemented, is mostly about:

• Pipes and permissions: who may call whose API, under what consent and security rules.
• National scope: frameworks are country-specific; very few are genuinely regional.
• Bank-centric data: many regimes start with current accounts and card data, not the full mix of wallets, platforms and B2B rails SMEs actually use.

Open banking says:

“With consent, Fintech X may read Customer Y’s data from Bank Z.”

Our problem is different: “How do we give a lender in Kigali or Lagos a simple, trusted way to see Ama’s combined Ghana–Nigeria–Côte d’Ivoire trade story, even though her flows run across multiple banks, wallets, switches and platforms?”

That requires more than raw APIs. It needs a standardised, cross-border, multi-rail product that sits on top of whatever open-finance pipes each country has.

That is what an African SME Data Passport is meant to be.

Why “just use accounting software” is not enough

The second reasonable objection is: “Why can’t SMEs just use proper accounting tools and share those reports?”

We absolutely want better accounting. But designing AfCFTA-wide data infrastructure that assumes every SME is a disciplined accountant is wishful thinking. In practice:

1. Most SMEs don’t run clean, integrated systems
   A minority use cloud tools like Xero, Zoho or QuickBooks. Many use Excel + notebooks + WhatsApp screenshots. Expecting continent-scale credit transformation to sit on self-compiled spreadsheets guarantees exclusion of the long tail.
2. Self-reported data is hard to trust at scale
   A lender has to reconcile PDFs of statements, exported ledgers and sometimes photos of receipt books. Behavioural payment data captured by regulated providers (banks, MNOs, PSPs) is harder to manipulate and easier to audit.
3. Multi-country SMEs face FX and format pain
   A pan-African trader might have:
   • MoMo flows in Ghana cedis,
   • card flows in Nigerian naira,
   • platform payouts in dollars or CFA.
     Normalising all of that manually inside an accounting system is a finance job, not a micro-entrepreneur job.
4. Bargaining power stays with the lender
   When everything is self-assembled, the lender decides how much time to invest in making sense of it. When the ecosystem offers a standard instrument based on verified system data, the SME’s negotiation position improves.

So it’s not “accounting OR data rails”. It’s: “Let’s automate aggregation of behaviour data that already exists in payment systems, and then let accounting and tax sit on top – not the other way round.”

What an African SME Data Passport could actually look like

Let’s move from concept to concrete.

Definition: An SME Data Passport is a portable, standardised, consent-based record of an SME’s verified payment and trade history that can travel with them across providers and across African borders.

1. Contents: summary, not surveillance

Instead of dumping every transaction, the passport would hold summarised, risk-relevant metrics, e.g. over the last 24–36 months:

• Monthly transaction volumes, by rail (bank transfers, MoMo, POS, QR, platform payouts).
• Number of transactions and active months.
• Average and median ticket sizes.
• Seasonality and volatility indicators.
• Refund/chargeback ratios (especially important for card/platform merchants).
• History of digital credit (e.g. Kopo Kopo advances, Wasoko inventory credit, M-Shwari loans), including repayment performance.

Each data-providing institution (bank, MNO, PSP, marketplace) would digitally sign its contribution so lenders can trust that it matches their internal records.

2. Flow: from multiple pipes to one artefact

• Local providers continue to capture data as they do today.
• A neutral data utility (national or regional) receives periodic summaries in a standard format.
• The SME:
  • Logs in (directly, or via their main provider),
  • Sees their passport,
  • Decides which parts to share with which lender, investor or buyer.
• The receiving institution consumes the passport via API or secure file and plugs it into their scoring and underwriting.

It’s “credit bureau meets trade passport”, designed for AfCFTA rather than for a single domestic market.

3. Boundaries: what it must not become

To keep trust, an SME Data Passport must not be:

• A detailed, line-by-line transaction dump that exposes all customers.
• A proprietary score owned by one vendor or platform.
• A mandatory “visa” for basic finance; it should be a fast lane, not a gate.

Who can lay this data rail?

AfCFTA gives us a political umbrella. PAPSS gives us an emerging payment spine. There are a few natural actors to extend that spine into a data rail:

1. Regional public infrastructure approach
   • Afreximbank and PAPSS already connect national switches and banks to clear cross-border payments.
   • A logical next step is a lightweight data utility that coordinates SME data schemas and consent, with the AfCFTA Secretariat and Smart Africa shaping standards.
2. National–regional hybrid
   • National switches like GhIPSS, NIBSS, GIM-UEMOA already sit in the middle of domestic payment flows.
   • They could aggregate domestic SME summaries and then pass regional-level passports via PAPSS or a similar layer.
3. Consortium / PPP model
   • A consortium of banks, fintechs (think Onafriq/MFS Africa, Flutterwave, Pezesha), MNOs and DFIs could co-create a neutral “SME Data Trust” with clear governance rules.

Whatever the structure, three design principles are non-negotiable:

• SME consent & control as default, not as an afterthought.
• Interoperability & neutrality so no single scheme or platform can capture the rail as a private moat.
• Inclusion by design, so a two-person business gradually going digital can build a passport, not only polished mid-market firms.

The risks – and how not to build a new wall

Serious infrastructure always creates the risk of new exclusion. Three issues to watch:

1. Surveillance and overreach

If badly designed, a passport could become a tool for states or corporates to interrogate every corner of a business.

Mitigation:

• Keep the schema to aggregates and risk metrics, not raw line items.
• Hard-code legal purpose limitations: who can access, for what decisions, with audit trails.
• Independent oversight (regulators + industry + SME associations).

2. Algorithmic bias

We already know women-led, youth-led and rural SMEs often have thinner, messier digital trails, more cash, more personal wallet use.

Mitigation:

• Combine passport data with alternative indicators (group lending history, savings patterns, association membership).
• Require large users of passport data to monitor outcomes by gender, sector, geography and adjust models where clear bias appears.
• Keep space for manual overrides and blended models, especially at smaller ticket sizes.

3. Digital divide

If only strongly digitised SMEs can build passports, the rest risk falling further behind.

Mitigation:

• Pair the passport with low-friction on-ramps:
  • Lite merchant wallets layered on personal MoMo accounts.
  • Simple tools that convert WhatsApp orders into receipts.
  • B2B platforms like Wasoko/MaxAB and PSPs like Pesapal acting as onboarding partners for smaller merchants.

A simple rule: The SME Data Passport should not become a visa regime that locks the smallest out; it should be an express lane for those who are ready, while pulling others along.

What an SME Data Passport unlocks

If we get this right, the gains are not theoretical.

For SMEs

• Faster, fairer access to working capital and trade finance at home and across borders, imagine Ama using her Ghana + Nigeria + Côte d’Ivoire passport to negotiate with a bank in Kigali.
• The ability to prove her true scale to a supermarket buyer, an investor, or an export partner.
• Less dependency on a single platform’s internal score, because she can carry her record to competitors.

For banks and fintechs

• Richer, more standardised data for cashflow-based lending instead of collateral-only decisions.
• Lower cost to underwrite SMEs entering new countries; less reliance on guesswork.
• New product opportunities: regional BNPL for merchants, AfCFTA trade lines, pan-African supply-chain finance.

For AfCFTA and governments

• A concrete mechanism to nudge the system away from property-based collateral toward behaviour-based collateral rooted in actual trade.
• A way to make PAPSS and national digital ID systems work harder for SMEs, not just for big corporations and governments.
• An African-owned data rail that complements – rather than simply feeds – global card schemes and foreign platforms.

If we leave SME payment and trade data locked in private or foreign silos, we will have built AfCFTA on borrowed rails. The continent will still be exporting not just raw commodities, but raw data and the margins it generates.

A three-point agenda

So what next? Three groups have homework.

1. Regulators & AfCFTA institutions

• Put SME data infrastructure on the same slide as PAPSS and customs reforms in AfCFTA roadmaps.
• Launch a working group (Afreximbank + PAPSS + central banks + Smart Africa) to define a minimum SME data schema and consent model for a continental passport.
• Ensure alignment with national open-banking / open-finance regimes, so we build once and reuse.

2. Banks, MNOs, PSPs, platforms

• Start acting as stewards of SME data today:
  • Give merchants better analytics and easy data export.
  • Pilot “mini-passports” or standardised data packs with partner lenders (many are halfway there already).
• Engage proactively in standard-setting so the eventual passport reflects operational realities, not just regulatory theory.

3. SME associations & women’s networks

• Demand a seat when data and open-finance rules are written – at central bank roundtables, AfCFTA forums, Smart Africa convenings.
• Advocate not just for “access to credit”, but for ownership and portability of the data that makes credit possible.
• Pilot group-based passports (e.g. for women traders’ associations) as proof-of-concept.

AfCFTA’s founding idea was that African businesses should no longer be strangers to one another.

An SME Data Passport is how we make sure African financiers, banks, fintechs, DFIs no longer treat African SMEs as strangers either, whether they trade from Accra, Lagos, Kigali or Abidjan.