Reducing Friction and Failure Rates in Cross-Border Digital Payments Across ECOWAS Through Interoperable Payment Systems and Data-Driven Product Innovation
DOI:
https://doi.org/10.63084/cognexus.v1i04.292Keywords:
cross-border payments, ECOWAS, payment interoperability, digital financial services, mobile money, payment system frictionAbstract
Cross-border digital payments within the Economic Community of West African States (ECOWAS) remain constrained by systemic friction and elevated failure rates that undermine regional trade integration and financial inclusion objectives. This paper presents a conceptual review of the literature, providing an analytical examination of the structural, regulatory, and technological barriers impeding seamless payment flows across ECOWAS member states. Through systematic analysis of interoperability gaps, regulatory fragmentation, and infrastructure deficiencies, the study identifies critical friction points spanning technical, institutional, and user-experience dimensions. The paper evaluates the Pan-African Payment and Settlement System (PAPSS) as a potential architectural solution while highlighting persistent implementation challenges rooted in regulatory heterogeneity. It further demonstrates how data-driven product innovation, encompassing transaction analytics, predictive modeling, and behavioral design, can catalyze friction reduction and enhance payment success rates. Findings reveal that achieving frictionless cross-border payments requires coordinated policy harmonization, technical standardization, and innovation ecosystems that prioritize user-centric design. The paper concludes with strategic recommendations for policymakers, financial institutions, and technology providers to accelerate payment system modernization and advance ECOWAS economic integration.
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