China’s digital payment system being introduced on the continent helps reduce dollar dependency, experts believe
As China doubles down on its economic presence in Africa, the relationship is entering a new phase that goes beyond bricks and mortar.
The Beijing Action Plan 2025-2027 includes support for 30 infrastructure connectivity projects across Africa, while countries such as Kenya and Uganda are already reviving Chinese-backed transport links, such as the Standard Gauge Railway extension and the Rironi-Mau Summit highway toward the Uganda border.
For analysts watching the continent’s financial future, these developments matter not only because they move goods but also because they may create the commercial architecture for a parallel payment system built around China’s Digital RMB (digital yuan/e-CNY), potentially giving African economies a faster, less dollar-dependent way to trade.
The Western-dominated global payments system, centered on SWIFT and intermediary banks, has long been criticized for high transaction costs, delays, and vulnerability to geopolitical pressure. But as China expands its digital cross-border payment system while deepening ties with Africa, analysts say the platform could mark a significant shift in how the continent moves money across borders.
‘Potential to reduce exposure to Western-controlled financial systems’
Michael Owuor, a development and transnational organized crimes expert based in Nairobi, observes that for many countries in Africa, China’s digital yuan is “slowly redefining traditional geo-commerce relationships by providing alternative financial platforms for trade.”
“For African economies, this new cross-border platform has the potential to accelerate regional and continental trade systems, reduce exposure to Western-controlled financial systems and politically engineered economic sanctions, and strengthen financial inclusion that the continent has been yearning for,” said Owour, who works at the Global Centre for Policy and Strategy (GLOCEPS), a think-tank based in Nairobi, Kenya.
According to Owuor, for Africa, a region that is deeply integrated into China’s Belt and Road Initiative (BRI) and is increasingly reliant on digital financial solutions, the digital yuan offers diverse opportunities.
“This platform is part of China’s broader push to make it easier for global businesses and consumers to transact directly in yuan without defaulting to reserve currencies like the US dollar,”Owuor told RT.
Faster and cheaper
Owuor notes that the grounding of China’s digital yuan in blockchain technology can make cross-border settlements faster, cheaper, and more transparent.
“Digital RMB’s blockchain-driven architecture reduces cross-border settlement times to mere seconds, unlike traditional SWIFT transactions, which often take 3-5 business days and involve multiple intermediary banks. This results in high fees at each stage of payment processing and delays in executing transactions,”Owuor told RT.
The digital RMB platforms cut settlement times to near real-time and can reduce costs by 40-60% or more.
Further, Owuor argues that its efficiency is particularly transformative for developing economies where cross-border payment delays and high costs have long hindered trade, investment, and capital transfer.
“The embedded smart contracts in this system automatically enforce regulatory requirements, reduce risks of fraud, and enhance transparency,” he adds.
‘Growing skepticism towards the US dollar’s dominance’
Joseph Kimotho, a Nairobi-based independent consultant and development finance specialist, argues that punitive economic actions by the Trump administration towards Global South countries have “inadvertently spurred demand for alternative financial platforms”.
“It is no secret that there is growing skepticism towards the US dollar’s dominance in global trade. Washington’s weaponization of the tariff policy as a tool for economic and political sanctions makes the Digital RMB a promising and welcoming option,” Kimotho told RT.
Kimotho suggests that China’s payment system offers an alternative, particularly for countries “seeking to insulate themselves from US sanctions and dollar dependency” while securing their presence in international trade.
He says that Africa’s integration into BRI makes it a natural beneficiary of the platform’s expansion endeavors, noting that the system, dubbed the ‘Digital Silk Road’, is more likely to underpin all payments and transactions under the BRI.
“This is likely to inform action by central banks in the Global South to hold the yuan as part of their foreign reserves,” he supposes.
‘Africa must guard against over-reliance on a single currency’
Isaac Shinyekwa, head of trade and regional integration at the Kampala-based Economic Policy Research Centre, notes the entry of digital Yuan into Africa could catalyze its integration with continental payment infrastructures, such as the Pan-African Payment and Settlement Systems (PAPPS).
“The entrenchment of PAPPS in regional and continental trade, coupled with strategic collaboration with the RMB cross-border payment platform, could enable African nations to bypass SWIFT for intra-regional transactions while reducing costs and delays,”he told RT.
Shinyekwa adds that efficient cross-border payment systems are imperative for the Africa Continental Free Trade Area, which aims to create a single market of 1.3 billion people.
“The Digital RMB’s speed and low cost could facilitate faster capital movement and thus boost intra-African trade. The adoption of it by Africa could accelerate regional integration, reduce exposure to US sanctions, and enhance financial inclusion and commerce,” Shinyekwa said.
Moving forward, Owuor foresees a situation in which Chinese-funded infrastructure projects in Africa will more likely be financed directly through these digital payment platforms. He warns, however, that this transition process must be carefully managed.
“It is imperative to carefully navigate regulatory, technical, and geopolitical challenges and opportunities, including users’ and country data rights. Africa must guard against over-reliance on a single currency or system, thus avoiding new forms of financial dependency,” Owuor concludes.
