Lesotho is now working on a National Payments Switch which experts believe will improve financial inclusion and innovation in the country, which according to the World Bank, lacks the legislative framework to secure electronic transactions.

In 2017 a government directive was issued stating that "a company shall not conduct the business of issuer of electronic payment instruments unless it is licensed" by the Central Bank of Lesotho.

Despite having a vibrant mobile money sector, serviced by the likes of Econet EcoCash and Vodacom's M-Pesa, the country does not have a functional national payments switch.

The Central Bank of Lesotho is now governing the process to develop and operate a switch, and has issued a formal notice inviting bids for design.

"The Central Bank of Lesotho invites duly registered and suitably qualified service providers/consultancy firms to undertake conceptual design and scoping of the National Payments Switch," said Motsoane Lechela, secretary of the tender committee of the Lesotho Central Bank.

The World Bank says Lesotho is still lagging in embracing e-commerce as well as in developing a legislative framework for electronic payments.

This is despite the country having a "considerably developed" telecommunications infrastructure boasting three international gateways offering access through South Africa to the Eastern Africa Submarine Cable System (EASSy), Seacom, and West Africa Cable System submarine cables.

"Other e-payment systems, such as online payments and online banking, are not widely used in Lesotho," says the World Bank in a 2018 study Unlocking the potential of Lesotho's Private Sector: A Focus on Apparel, horticulture, and ICT.

It continues: "The lack of a legislative framework for secure electronic transactions and weak availability of public services online restrict the development of e-commerce and efficient delivery of government services."