At the Rusumo border crossing between Tanzania and Rwanda, trucks, motorcycles, buses, and pedestrians move constantly through one of East Africa’s busiest trade corridors. Every day, thousands of traders, more than 70 % of them women, transport tomatoes, maize, fish, fabrics, cooking oil, and household goods between local markets, helping families earn a living and keeping goods moving across the region. This intense flow of trade is unfolding in a region that has become one of the world’s most dynamic hubs for digital financial services and mobile money.

According to Global Findex 2025, Tanzania recorded 65.4% account ownership, including 58.7% with a mobile money account. Rwanda shows even stronger financial inclusion: FinScope 2024 reports that 92% of adults used a formal financial service , with mobile money usage reaching about 66% of the adult population.

Yet cash remains dominant in cross-border trade, as observed at Rusumo. TradeMark East Africa found that nearly 80 % of cross-border women traders continue to transact primarily in cash, despite widespread access to mobile money services.

Ahead of a Proof of Concept at Rusumo, focused on building a responsible digital payments ecosystem for cross-border trade, the Bank of Tanzania, UNDP Tanzania, and the Better Than Cash Alliance engaged with traders to understand their needs and payment practices. Grounded in traders’ lived realities and priorities, the initiative aligns with the East African Community’s Cross-Border Payments Masterplan.

A trader-centric approach: Start with the problem, not the product

Conducted in November and December 2025 across three major cross border trade corridors —Namanga, Mutukula, and Rusumo — linking Tanzania with Kenya, Uganda and Rwanda, the scoping study provided important insights into the payment practices and operational challenges faced by cross-border traders, particularly women and youth. The consultations involved traders, regulators, mobile money operators, financial service providers, and trader associations.

The findings from the scoping exercise culminated in the Tanzania Cross-border Payments National Dialogue, convened by the Bank of Tanzania in March 2026. The dialogue reinforced a key finding from the field consultations: many digital payment solutions are still introduced as products to promote, rather than practical tools designed around traders’ everyday realities.

The discussions highlighted an important lesson reflected in the UN Principles for Responsible Digital Payments: traders are more likely to adopt digital payments when systems are transparent, reliable, easy to understand, and responsive to their needs.

Many traders pointed to unclear product pricing and fees, opaque foreign exchange conversions, failed transactions without clear recourse, and limited customer support when problems arose. In practice, these gaps reduced trust in formal digital payment solutions and weakened the perceived value of moving away from cash.

For traders operating on tight margins, this is not a minor inconvenience; it is a material business risk. The broader system compounds the problem. Formal trade pathways can feel complex and costly, while informal cash-based transactions, though riskier, often remain faster, more flexible, easier to navigate and intuitive. In that context, cash is not a fallback. It is a rational choice.

Traders Voices: What are they actually asking for?

The consultations did not point to a single solution or “silver bullet.” Instead, they revealed a set of practical priorities grounded in traders’ daily realities.

Traders expressed a need for clarity/transparency and coordination rather than persuasion. They want to better understand how payment systems work across providers, what fees and exchange rates apply, what happens when a transaction fails, including where complaint mechanisms exist and who is responsible when something goes wrong. They also want tools that support broader business needs, including record keeping, savings, and business growth, not just digital payments.

More fundamentally, traders emphasized the need for a system that feels coherent, connected, and predictable. Today, many are left to navigate fragmented payment processes, border procedures, taxes, exchange rate practices, and unclear complaint and recourse systems largely on their own.

Why Rusumo is an ideal test bed for cross-border digital payments: A trader perspective approach

The insights gathered across multiple border points point to a broader challenge: designing cross-border digital payment systems that work within the realities of the current informal trade and support the people who rely on them every day.

The upcoming Rusumo Proof of Concept will test practical solutions designed around the challenges traders themselves identified. Traders will remain actively engaged throughout the process, helping to co-create, shape, validate, and refine the solutions being tested. The Proof of Concept will also seek to strengthen coordination among regulators, financial service providers, (including mobile money operators and fintechs), and trader associations to improve interoperability, and usability in cross-border digital payment systems, particularly for women traders.
The focus will be on five linked areas:
•    Trader-centred onboarding, including guidance on fees, foreign exchange, fraud risks, and recourse
•    Clear and transparent pricing and foreign exchange information
•    Business and user-friendly payment tools supporting growth and daily operations
•    Accessible customer support and recourse mechanisms
•    Evidence and learning to identify corridor-level and regional barriers
If successful, lessons from the upcoming Rusumo Proof of Concept could inform broader East African Community efforts to build cross-border payment ecosystems that are not only digital, but also practical, trusted and aligned with the realities of how trade takes place on the ground.

Authors: 

• Kidee Abubakar Mshihiri, Senior Principal Bank Officer Directorate of National Payment Systems Bank of Tanzania

• Edward WageniEdward Wageni, Cash to Digital Payments Transition and Knowledge Generation Specialist. 

• Scheherazade Bouabid Communications Specialist