It is ironic how Africa, which is one of the world’s largest remittance recipients, is largely unbanked. It raises questions through so many minds as to why Africans, who are in need of remittances from abroad, have very limited interest in banks.
Traditional banks are still struggling to reach the unbanked across Africa. Statistics show in 2014, a staggering 66% of Sub-Saharan Africans did not have a bank account – which was because of things such as the bias towards paperwork, the many nitty gritties that banks ask for, their high charges and the fact that majority of the unbanked populace have low income levels. These being just a few of the umpteen complaints about banks that many in Africa speak of.
Mobile money on the other hand has been of humongous impact to 85% of the continent’s economies, many African nations have mobile money as their core form of moving money within the economy. Taking Kenya as a case study, Mpesa handles over 65% of the countries money transactions across the vast East African nation.
Why people subscribe to mobile wallets more than they do to banks
- Mobile money possesses lower transaction costs than banks for every time money is sent.
- Convenience – everyone has at least one mobile phone that can be registered to mobile money whereas bank branches and ATM’s aren’t accessible everywhere ; often neglecting those in rural areas who are the biggest receivers of remittances.
- No paperwork, lines or long procedures involved in accessing one’s money.
- The recipient gets their money on the mobile phone instantly regardless of time or place.
Remittance businesses turning towards mobile wallets
Business research has indicated that more volumes of remittances have been moved across Africa ever since money transfer operators dealt with mobile wallets because this is how Africa has chosen to transact and not through banks – anything outside the normal habit would repel clients.
Remittance companies now tailor their services to accommodate mobile money in countries where they send money bar Nigeria and South Africa who are staunchly bank driven economies.
How remittance companies are dealing with mobile money in African nations
DusuPay has enabled remittance companies to avoid using banks where there is no need but rather focus on convenience for clients through their mobile wallets.
DusuPay allows remittance companies pay out to Africa’s mobile money while enabling the same companies to use banks in bank driven African nations such as South Africa and Nigeria. Money transfer services from abroad just sit back and let DusuPay link their services to the plethora of remittance clients through the easiest means.