Circle Partners Onafriq to Cut Africa's $5 Billion Cross-Border Payment Fees by 80%

Circle, a leading stablecoin issuer, has partnered with Onafriq, Africa’s largest payments gateway, to reduce the high cost of cross-border payments across the continent using USDC. This collaboration aims to pilot USDC settlements within Onafriq’s extensive network, which connects over 500 wallets and 200 million bank accounts in more than 40 countries. The integration of USDC is expected to simplify financial transactions for both institutions and individuals, reduce costs, and enhance trust in digital financial services.

Currently, over 80% of intra-African transactions are routed through correspondent banks outside the continent and settled in foreign currencies like the US dollar or euro. This results in approximately $5 billion in fees annually, highlighting the need for more efficient and cost-effective payment solutions. The partnership between Circle and Onafriq aims to address this issue by leveraging USDC, a stablecoin pegged to the US dollar, to facilitate more efficient and cost-effective transactions.

Dare Okoudjou, the founder and CEO of Onafriq, emphasized the transformative potential of this partnership. “By integrating USDC, we aim to simplify financial transactions for institutions and individuals, reduce costs and strengthen trust,” he stated. This initiative aligns with Circle’s broader strategy of expanding USDC adoption globally, particularly in regions with significant potential for digital asset innovation.

Miriam Kiwan, the vice president at Circle responsible for the Middle East and Africa, highlighted Africa’s potential for stablecoin adoption. “Africa holds tremendous potential for digital asset innovation, particularly in the adoption of stablecoins for cross-border payments,” Kiwan said. The collaboration between Circle and Onafriq aims to transform how money moves across borders, offering secure and transparent digital payment rails that enhance economic empowerment and connectivity.

Circle’s global expansion strategy includes the launch of the Circle Payments Network (CPN), a consortium of financial institutions aimed at streamlining global fund movement and settlement using stablecoins. The network, which includes over 20 partners such as World Remit, Yellow Card, and Fireblocks, received advisory support from major banks. The CPN is designed to address inefficiencies in traditional cross-border payments and support various use cases, including remittances, payroll, treasury, and invoice payments.

In addition to its global expansion efforts, Circle has also received in-principle approval from the Financial Services Regulatory Authority of the Abu Dhabi Global Market. This approval allows Circle to operate as a regulated money services provider in the United Arab Emirates, further solidifying its presence in the global financial market. The partnership with Onafriq is a significant step towards achieving Circle’s vision of a more efficient and inclusive global payment system, leveraging the power of stablecoins to drive economic growth and financial inclusion.