To reduce dependence on the United States (US) dollar by East African Community member states, the regional bloc is developing an integrated payment and settlement system.
The First Deputy Prime Minister and Minister for East African Community Affairs (EAC), Hon. Rebecca Kadaga, made the revelation in her statement on implementation of the East African Payment System (EAPS) during plenary sitting on Tuesday, 03 November 2026.
“A fully integrated payment and settlement system will reduce the cost of doing business, deepen intra-EAC trade and provide an important foundation for the proposed East African Monetary Union and eventual single currency,” she said.
The objective of the system, according to Kadaga, is to establish a regional payment ecosystem in which an individual or business can transfer funds securely, instantly and affordably between any two EAC partner states using a bank account, mobile-money wallet or other authorised digital-payment channel.
“The main existing mechanism is the East African Payment System, which connects the national Real-Time Gross Settlement systems of Uganda, Kenya, Tanzania and Rwanda,” Kadaga said. Adding, “It enables commercial banks to transfer funds across borders securely and settle transactions in regional currencies, including the Uganda shilling, Kenya shilling, Tanzania shilling and Rwanda franc.”
However, Burundi, South Sudan, the Democratic Republic of Congo and Somalia, Kadaga said, are not yet fully integrated into the platform, thereby affecting the overall goal of full regional coverage.
“To address these challenges, the EAC adopted the Cross-Border Payment System Masterplan in 2025. The masterplan provides for expansion and modernisation of EAPs, harmonisation of payment-service-provider licensing and regulation and increased use of Partner States' currencies in regional transactions,” she said.
She tasked the Ministry of Finance, Planning and Economic Development, Bank of Uganda, commercial banks, mobile-network operators and fintech companies to cooperate with her ministry, if effective implementation of cross border masterplan is to be achieved.
She added: “Parliament has an important role in supporting harmonisation of Uganda's payment-system legislation with EAC frameworks by providing adequate resources for digital and financial infrastructure, monitoring Uganda's implementation of regional commitments and supporting the eventual integration of all eight partner States.”
The Shadow Minister for EAC, Hon. Hakim Kizza, welcomed the development but urged the Ugandan government to champion creation of a central bank-backed liquidity facility.
This intervention, Kiiza said, will ensure that commercial banks always have access to sufficient Kenyan, Tanzanian and Rwandan currencies. He said that this would eliminate the forced reliance on the US dollar.
“Despite the rhetoric of local currency settlement, traders are still forced to convert to the US dollar for cross- border transactions due to liquidity shortages in regional currencies at commercial bank levels,”
He added,” A local trader wishing to buy goods from Kenya has to convert their Uganda Shillings into US dollars first, and then into Kenya Shillings. Commercial banks make billions in profits from these double-conversion fees.”
Hon. Molly Kamukama, District Woman Representative, Kazo said that one of the ways of making the EAPs effective is through attainment of the EAC single currency.
The Speaker, Jacob Marksons Oboth, called for regular updates on the EAC integration, as well as awareness campaigns among the members of the public.
“We need to know the status of our integration, generally. We have organised a marathon in November to create awareness. We request the Minister of EAC to prepare a status report on the integration, highlighting challenges and opportunities,” Oboth said.