Money Remittance is Continuously evolving over time in Africa. Unlike other markets where funds have always been transferred to bank accounts, the African market is a little different. As a money remittance company your success on the continent would fully be based on understanding he dynamics of the continent and here is what you need to know for starters: These could be the reasons for why money remittance to Africa has evolved.
- Africa has 54 different countries.
- The largest percentage of recipients especially in sub saharan Africa do not have bank accounts
- Africa has the fastest growing money transfer market in the world according to this world bank report http://siteresources.worldbank.org/EXTDECPROSPECTS/Resources/476882-1157133580628/RMA_FullReport.pdf .
- Mobile money is now the preferred mode of receipt of funds in sub saharan Africa.
- Africa is hugely reliant on money transfers.
These reasons have forced money transfers to Evolve all across Africa. Keeping a blind eye to this evolution could be detrimental to your money remittance business.
Note that all modes of pay out options listed below still co-exist. The trend stated is only based on preference of more people over time.
a) Before 1970
Money remittance was quite crude across multiple African countries. In most cases people had to move with money manually across boarders. Yes networks like money gram and western union existed but there reach was so small the only logical way to get money across boarder was by moving with it across boarders in planes or buses.
Disadvantages with how money was moved back then:
This was quite risky. Most times people would get robbed in transit moving money
Moving money at times took up to several weeks for the recipient to receive the funds
b) The rise of the Outlets through banks and money transfer pick up locations
Time Range: 1970-2010
With Banks, Western union and Money Gram extending to more countries. It became increasingly easier to send money to Africa.
Cost. It is quite costly using banks and money gram or western union.
lack of scale. The outlets are quite few in many cases people have to Travel
c) The Age of digital
Since the launch of MPESA in Kenya, mobile money has changed the game when it comes to money transfers. The cost of remitting funds has become so small making it possible for other smaller money remittance companies to ride the wave.
More money remittance companies than ever are using platforms like www.dusupay.com to tap into the low cost instant transfer African market.
With DusuPay, money transfer to Africa has never been cheaper. With one integration, money remittance companies can pay out across multiple countries cheaper and instantly to both mobile money wallets and bank accounts