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2020, the year of intra-African remittances says WorldRemit

By , Portals editor
Africa , 13 Feb 2020

2020, the year of intra-African remittances says WorldRemit

Online international money transfer company WorldRemit predicts that 2020 will be the year of intra-African remittances.

The company said the World Bank has estimated that migrant workers within Africa send remittances in excess of US$14-billion dollars each year, and in 2018 intra-African remittances represented 20% of global remittance flows according to Ecobank Group.

To give context, according to WorldRemit, the African Continental Free Trade Area (ACFTA) agreement (which promotes intra-African trade and regional integration) is fuelling intra-continental movement of people.

"Migrant workers are no longer just traveling to developed nations for work (traditional south to north migration patterns), opportunities lie closer to home. Between 2015 to 2019, intra-African migrants grew from 16 million to 19 million. During the same period, migration out of the African continent only increased from 16 to 17 million," the money transfer firm suggested.

This new trend of south to south migration does not change the desire to send money home, yet the vast majority of remittances are still sent 'offline'.

This informal remittance industry in Africa is estimated to be between two and ten times the size of the formal market, it added.

"Money is taken to, and collected from a physical agent which can be inconvenient and usually subject to high fees. Africa has the highest costs for remittances globally, averaging 9% for $200 transaction compared to the global average of 7%. This is far from the UN's Sustainable Development Goal (SDG) of 3% by 2030," WorldRemit explained in its statement.

"However, with over 122 million users of mobile money services in Africa, and smartphone connections forecasted to grow to 636 million in 2022, hitting the SDG is likely to depend on building the right infrastructure to support an increasingly mobile population," WorldRemit continued.

The international money transfer service has partnered with Vodacom Tanzania, Wizall of Senegal and Tigo in Ghana to reinforce its network.

In early January 2020, Business Wire news service reported that WorldRemit had partnered with Wizall to launch the service in Senegal.

An excerpt from the report reads: "The new partnership with Wizall Money enables WorldRemit customers in over 50 countries, including France, Spain and the USA, to send money home instantly to over 60 000 mobile money accounts in Senegal. Recipients can then store their funds, pay for bills or pay for goods in shops directly from their Wizall Money account. In addition to the new mobile money service, WorldRemit also offers bank transfer, cash pickup and mobile airtime top-up services to Senegal, so customers can choose the pay-out option that suits their receiver best. Estimates suggest that the Senegalese diaspora community is almost 560,000-people strong, and the money they send home makes a huge difference to the lives of thousands of families. Senegal is estimated to have received almost $2.5bn in remittances in 2019, accounting for 10% of the country's GDP."

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