By Mark Mwaniki
Ugandan businesses are expanding across Africa. From agriculture to manufacturing and services, more firms are entering regional markets, securing new customers and building cross-border partnerships. On the surface, this is a positive story for African trade.
But beneath that growth lies a quieter problem.
Many businesses are still losing value, not because they cannot sell, but because of how they get paid. And this is the part of the trade conversation that receives far less attention.
Much of the focus around African trade continues to centre on market access, logistics, tariffs and frameworks such as the African Continental Free Trade Area. These are important. But increasingly, they are not where businesses lose the most value.
The real constraint now sits in the financial layer of trade.
For a Ugandan exporter, a transaction is not complete when goods are delivered. It is complete when value is received, converted and settled. That process remains slow, fragmented and, in many cases, expensive.
In practice, businesses can lose between 5% and 10% of the value of a transaction through foreign exchange spreads, intermediary fees and settlement delays. For large corporates, this may be absorbed as part of doing business. For SMEs, it can determine whether a transaction is profitable at all.
A Ugandan agribusiness exporting coffee, grain or processed goods into regional markets may wait several days to receive payment, only to find that exchange losses and transaction fees have significantly reduced the value of the deal.
This creates a problem many businesses do not anticipate.
Companies compete on the strength of their products and services but lose margin on the movement of money itself. This is a structural issue because a significant share of intra-African payments still relies on correspondent banking systems outside the continent. Transactions between African markets are often routed through financial centres in Europe or the United States before reaching their destination. Every additional layer introduces cost, delays and uncertainty.
For businesses, the consequences are significant. Pricing becomes harder to manage. Cash flow becomes less predictable. Expansion decisions become more cautious.
Over time, companies begin prioritising markets where payments are easier rather than where demand is strongest. Some avoid intra-African trade entirely. Others build in cost buffers that reduce their competitiveness.
This creates a disconnect between Africa’s trade ambitions and the systems supporting them.
The continent is working to unlock trade through policy reforms and regional integration, yet the infrastructure supporting the movement of value has not evolved at the same pace. The conversation therefore needs to shift.
The question is no longer whether African businesses can access markets. It is whether they can retain the value they create through trade.
Business leaders have increasingly pointed to the hidden costs embedded in cross-border commerce. Aliko Dangote has repeatedly spoken about how inefficiencies in financial and regulatory systems continue to affect African enterprise, even at scale.
Institutions such as African Export-Import Bank have also highlighted the scale of the challenge, noting that a large share of intra-African payments still depends on external clearing systems.
For Uganda, whose exporters increasingly rely on regional markets for growth, the efficiency of cross-border payments is becoming just as important as market access itself. This is especially true for SMEs, many of which continue to face foreign exchange liquidity constraints that make it difficult to settle transactions quickly, manage currency exposure or plan confidently across markets.
Greater attention therefore needs to be given to financial infrastructure, particularly the systems that support cross-border payments. This includes improving settlement speed, increasing transparency in pricing and reducing dependence on external clearing networks.
Encouragingly, change is beginning to happen. New payment solutions are emerging that allow businesses to hold multiple currencies, settle locally and manage foreign exchange more efficiently.
However, adoption still needs to scale.
If payment inefficiencies continue to be treated as a normal cost of doing business, value will continue leaking out of African trade. Addressing them directly creates a different outcome, one where businesses compete on the strength of their products rather than the friction of their payments.
Ugandan exporters are already proving they can win in new markets. The next step is ensuring they retain more of the value they create.
The author is the Sales Director for East Africa at Verto