MONROVIA-The Board of Directors of the African Development Fund has authorized US $3.9 Million Grant to assist in the payment of a project that would improve Liberia’s Infrastructure.
The Bank’s Concessional Lending Window cleared the Grant on March 17, 2023. The Project’s Primary Goal is to improve the payments ecosystem in Liberia so that it works better, and encourages growth and new ideas.
It is directed at the automated cheque processing and Clearing House (ACP/ACH) Systems and the Real-time Gross Settlement (RTGS) Systems, which are the backbone of payment processing in the Country’s Financial Industry.
The Central Bank of Liberia’s Primary Data Center and Disaster Recovery Sites will also be upgraded as part of the project.
This is expected to affect the institutions and government departments dealing with payments.
Commercial Banks and their customers would also get better services, faster response times, real-time processing, and online administrative access.
The initiative will also help bring closer people and the region together by bringing the technology up to essential standards.
For Liberia, this project will directly affect the roll-out of the proposed National Electronic Payments Switch (NEPS) System, which is meant for the retail business, where most people are left out. When the World Bank approved the NEPS project in 2022,
The proposed project is a crucial part of efforts to improve financial inclusion in Liberia, which is currently at 44.2% (Findex 2021), and reach under-served groups, like Women, Youth, Smallholder Farmers, Micro Small and Medium Enterprises (MSMEs), and other rural populations.
The new project will start to be put into action in June 2023. The Central Bank of Liberia will do it in close cooperation with both financial and non-financial organizations.
Benedict Kanu, who is the Country Manager for Liberia at the African Development Bank, said, “Modernizing Liberia’s Payments Infrastructure and Systems to make payments more efficient will not only strengthen the formal financial sector, but it will also lead to more financial stability and better private sector development.”
He also said that these changes would help close the gap in financial inclusion by giving infrastructure assistance to the NEPS initiative, which was paid for by the World Bank.
The project would also help Liberia get readied for the Regional efforts to integrate its Financial Systems, and for more trade across borders, which will require a robust payments infrastructure.
Ahmed Attout, the Interim Director of the Financial Sector Development Department, said that the Bank’s Financial Sector Development Strategy is meant to help Domestic Economic Systems in Regional Member Countries and ensure they meet Regional and International Financial Standards.
He also said that developing the Financial Sector, through infrastructural and digital finance assistance is essential for extending the private sector, especially in a world that is becoming more digital and needs to be more inclusive.
The Banking Sector in Liberia has a lot of problems, such as not having enough ICT and last-mile reach infrastructure.
The Country’s current Payment Systems, set up in 2016 with aid from the African Development Bank, have worked effectively for the past six years, but they need to be updated.
This project aims to enhance the Financial Sector, establish financial stability, close the gap in financial inclusion, and make integration in the Region more accessible.