What it Means for Africa’s two Biggest Economies to Exit the Dirty-Money List

Two of Africa’s largest economies, Nigeria and South Africa, have been removed from the Financial Action Task Force (FATF) “grey list,” easing international scrutiny of their financial systems and strengthening their standing with global investors and banks.

Mozambique and Burkina Faso were also delisted, marking a significant shift for African markets working to tighten controls on illicit financial flows.

The FATF grey list, often referred to as the “dirty money list,” identifies countries under increased monitoring for weaknesses in anti-money laundering and counter-terrorist financing regimes.

While greylisting doesn’t impose automatic sanctions, it sends a negative signal to the international community.

A study by the International Monetary Fund (IMF) found that greylisting can sharply hurt a country’s economy, reducing capital inflows by up to 7.6% of GDP and leading to declines in both foreign direct investment and other investments.

First, it gives an important boost to investor confidence. Global institutions, banks and funds will view Nigeria and South Africa as lower risk, making cross-border investment or banking relations slightly easier and less costly.

For businesses involved in trade and finance, particularly those transacting internationally, it reduces the extra layers of scrutiny, delays and costs that often accompany transactions from a flagged country.

In Nigeria, Finance Minister Wale Edun described the development as reinforcing confidence in the economy and the integrity of the country’s monetary and financial systems.

“This development reinforces confidence in our economy and the integrity of our monetary and financial systems, signalling to investors and global partners that Nigeria’s institutions are strong, transparent and internationally trusted,” Edun noted.

Business and Tech Leaders React

African fintech leaders say the decision removes a significant obstacle for companies that rely on cross-border settlements. Flutterwave founder and CEO Olugbenga Agboola said the additional scrutiny over the past year made international transactions slower and more expensive, especially for remittances and business payments.

“Flutterwave is Africa’s most licensed non-bank financial institution with 50+ licenses + massive investment in keeping compliance at the highest standards. This grey listing made cross-border payments/settlements harder & more expensive. This delisting restores confidence, lowers remittance & xborder costs, and unlocks faster, cheaper payments to & from Nigeria,” he said.

Meanwhile, venture-capital investor Kola Aina of Ventures Platform described the removal as “great news for our economy… it will save a lot of time, reduce costs, ease cross-border transactions, and help attract the capital flows we need to drive economic growth and development.”