The Payment System


The Committee on Payment and Settlement Systems of the Bank for International Settlements (BIS), define payment systems as “a set of instruments, banking procedures, and typically, interbank funds transfer systems that ensure the circulation of money”. In effect, payment systems encompass a set of instruments and means generally acceptable in making payments, the institutional and organizational framework and the operating procedures governing such payments, and the communications network used to initiate and transmit payment information from payer to payee thereby transferring value from one end to another.


The payments system reform effort in Liberia originated from the WAMZ's initiative to achieve regional economic integration of the member states. In so doing, Liberia, through the Central Bank of Liberia (CBL), fast track its assertion to the WAMZ in 2010 in order to take advantage of funding assistance from the African Development Bank (AfDB) through the West African Monetary Institute (WAMI) to upgrade the Payments System infrastructure in select countries in West Africa, in preparation for the lunch of the monetary union. Prior to the start of the regional integration process, the CBL recognized that payments system modernization was a national imperative, critical to economic and financial sector development of the country and therefore took ownership for its implementation. The programs of reform under the modernization agenda include technological upgrade of metropolitan network infrastructure, a state-of-the-art data centers, and software solutions to facilitate online real time payments of all types between participating financial institutions in the country.


In trying to achieve this ambition program, the CBL sought a consensus through collaboration with key stakeholders in order that a holistic view of all aspects of the nation’s payment system needs would be satisfied  in an orderly and cost-efficient manner. A collaborative approach was highly desirable because of the complexity of the required changes that will involve inputs relating to service providers, users, technology, legal and regulatory matters, as well as contributions from several professional disciplines. The CBL is of the view that a well-structured collaborative approach involving all stakeholders will create synergy, stimulate learning and provides a basis for optimizing benefits through cooperation and consensus building. The Project Implementation Document (PID), which defines the governance and management structure, was therefore designed to inculcate the active participation of all stakeholder.



The modernization of the Payments and Settlement Systemswas informed by the commitment that the CBL will endeavor to achieve the following objectives:

  • eliminate as far as possible, risks from payments, clearing and settlement systems;
  • establish a real-time on-line systems with Delivery versus Payment (DvP) facilities as envisaged to facilitate the speedy exchange and settlement of funds and securities;
  • improve convenience, service and security for users, especially keeping in mind that there is high cash intensity and the general trend is to migrate from cash and paper payment instruments into a state of high usage of electronic modes of payment;
  • bring efficiency to Government receipts and payments and leverage them for financial inclusion;
  • pursue the development of all payment streams that will effectively improve cash management by CBL; and
  • improve microeconomic management capabilities of the CBL by providing  timely and accurate information on the movement of funds;
  • consistent with the ECOWAS vision for economic integration of the member states,  prepare the country's financial infrastructure to enable the processing cross border electronic payments thereby facilitating/increasing intra-regional trade among its member states.

In order to effectively achieve the policy objectives outlined above, the CBL established a Payments System Unit in 2011 to better coordinate the reform process leading to the implementation of the Payments, Clearing and Settlement needs of the financial system in Liberia.


Function of the Unit

The Unit is currently spearheading the implementation of the Payments System Modernization Project working with all stakeholders. The Unit functions, among others, include:

  • carry out the reform of the payment system components being undertaken by the CBL. These include Infrastructure upgrade, Real time Gross Settlement System, Scripless Securities Settlement System, Automated Check Processing (ACP) and Automated Clearing House (ACH) systems, and the Core Banking Application of the CBL. The requisite teams/committees has been constituted to assist Solution Providers engaged by CBL to carry out these tasks;
  • oversee designated payment and settlement systems in Liberia. In so doing, the Unit shall ensure that all entities licensed to offer payment services in Liberia are regulated through periodic returns and on-site supervision;
  • supervise all checks clearing and payments settlement schemes in operation in Liberia The Unit shall manage the following systems:
    1. Real Time Gross Settlement (RTGS)
    2. Scriptless Securities Settlement (SSS)
    3. Automated Check Processing
    4. Automated Clearing House;
  • manage the Bank Identification Code Directory, defining the sort code for each bank (financial institution) participating in the clearing and settlement system; and
  • gather statistics on checks clearing and settlement of payment streams in terms of volume and value


  1. Terms of Reference for the Competition on the ECOWAS Single Currency Name and Logo
    29th October 2018 | Size: | File Type: pdf