Financial institutions in East Africa are being challenged to go beyond traditional transactions and position themselves as critical enablers of regional trade, as geopolitical tensions, rising operating costs, and supply chain disruptions continue to reshape global trade.
That was the central theme at the Absa Trade and Connectivity Thought Leadership Forum held in Nairobi, which brought together bank executives, trade finance experts, fintechs, and development finance institutions to discuss how the region can build resilience and better support businesses in a volatile global environment.
Absa Group Regional Trade and Working Capital Product Specialist, Jeremiah Mutune noted that payment infrastructure, cross-border settlement efficiency, and integrated trade finance systems are the foundation on which competitive trade ecosystems are built.
“Against the backdrop of geopolitical tensions, the strongest infrastructure we have as banks is to make sure that we remain connected. Transactional banking is a key infrastructure in the sense that it facilitates payments, enables efficient cross-border settlements, and ensures integrated trade finance systems, and that paints a good picture in terms of transparency when we are conducting trade between ourselves, other banks, and our clients,” said Mutune.
He emphasised that banks capable of offering seamless, end-to-end supply chain and payment solutions are better positioned to give clients a competitive edge.
“Any bank that has seamless integrated supply chain and payment solutions will have a competitive advantage, because trade goes hand in hand with liquidity and payments,” he added.
Absa Bank Kenya Transactional Banking Director, Lydia Karanja explained that the current environment calls for a fundamental restructuring of how financial institutions support trade.
Karanja cited the ongoing Middle East conflict as a key driver of disruption, affecting shipping routes, fuel costs, and supply chain predictability across the region.
“The global and regional economic recovery remains uneven and continues to be shaped by persistent geopolitical tensions affecting trade, global supply chains, and energy markets. Our role is not simply to facilitate transactions, but to enable businesses to scale confidently across borders and access opportunities wherever they exist,” said Karanja.
Despite the challenges, Karanja pointed out that East Africa, and Kenya in particular, is increasingly recognised as a strategic commercial hub, with global multinationals establishing regional headquarters here as they expand across the continent.
For banks, this means building better relationships, processing payments faster, and making it easier for businesses to operate across different countries.
“As financial institutions, this evolution calls on us to think differently about how we support trade and position ourselves as ecosystem enablers. It requires stronger partnerships, faster and more efficient transaction flows, deeper correspondent banking relationships, and greater investment in innovation and connectivity,” added Karanja.
Experts noted that there remains a persistent financing gap affecting Small and Medium Enterprises (SMEs), particularly in accessing trade finance tools such as purchase order financing.
Additionally, the experts called on banks to simplify and digitise trade finance solutions to make them more accessible to smaller businesses, which continue to play a critical role in regional commerce and job creation.
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