RemitONE Webinar: Turn Transactions into New Revenue & Reduce Costs
Many cross-border payment providers are unaware of how much their compliance checks are costing them time and money.
With compliance costs rising, loyalty becoming harder to maintain, and margins under pressure, many providers are starting to rethink how they grow profitably without adding complexity.
In our latest webinar, we explored how money transfer operators, fintechs, and payment providers are using AI and value-added services to reduce operational costs, improve approvals, and unlock new revenue opportunities around the transaction.
What you’ll take away:
- Cut compliance costs with centralised PEPs & sanction checks
- Improve transaction approvals and speed with AI
- Automate manual compliance processes and reduce workload
- Prevent fraud and speed up onboarding ID verification with liveness checks
- How value-added services like open banking, eSIMs, airtime, and payout aggregation create new revenue
If you missed the live session or want to revisit the strategies discussed, you can watch the full replay below.
As competition tightens across cross-border payments, growth is becoming less about doing more, and more about operating smarter.
The providers pulling ahead are reducing friction, improving customer experience, and creating more value around every transaction, while keeping costs under control.
If you’d like to explore any of the topics discussed in more detail or see how they could work for your business model, feel free to reach out to the team at marketing@remitone.com or book a free call with Oussama.
How Money Service Businesses Can Stay Resilient During Political Instability
In today’s climate, political tensions are already shaping how money moves across borders. For money service businesses in cross-border payments, this can mean adapting to changing regulations, shifting corridor dynamics, and evolving customer behaviours.
While these situations can bring pressure, they also highlight an opportunity to build long-term resilience, as those who are equipped with the right tools and strategies can continue operating smoothly and supporting their customers without disruption.
Digitisation: keep funds moving
Let’s explore how your money transfer operations can remain stable in the current environment.
During periods of disruption, customers tend to gravitate towards faster, more accessible, and mobile-first options, prioritising reliability and speed over traditional in-person services.
Mobile wallets and open banking allow customers to send money securely, instantly, and without relying on physical locations.
By enabling digital access, businesses can ensure continuity, improve convenience, and meet customers where they are, helping transactions remain seamless, even as the landscape shifts.
Data shows:
- 5.2 billion people used digital wallets globally in 2025, over 60% of the world’s population.
- Visa and Mastercard pilots have shown stablecoins fees to be less than 1%, helping to improve margins for money service businesses (MSBs)
By embracing digital channels, businesses can gain:
- Operational continuity, even if branches or corridors are disrupted
- Lower costs and faster transfers for your customers
- Future-ready infrastructure, prepared for new trends like CBDCs and digital-first remittances
In short, the more digital your business, the easier it is to keep operations flowing. We’ve also kept this in mind by embedding digitisation at the core of our RemitONE system, with open banking and wallets integrated, alongside a customisable app for our clients to stay relevant to their customers’ changing needs and continue moving forward.
If you’re interested in these tools to future-proof your operations, you can get in touch at marketing@remitone.com or see which fit best based on your needs by booking a free demo
Strategic planning: adapting to disruption with AI
Having clear contingency plans in place before further problems appear is crucial, and technology plays an increasingly important role here. AI and automation are helping financial institutions detect risks earlier, anticipate fraud spikes, and maintain operational continuity during turbulent periods where they’re most exposed. Over 70% of financial institutions in the UK are already using AI in their workflows. In the same way, our AI tools help automate FX rates and fees to optimise margins, which you can see in action.
But resilience isn’t just about technology; it’s also how to stay afloat without it. If systems temporarily go down or digital channels are disrupted, businesses need reliable fallback methods to stay connected with their customers. Simple measures such as SMS notifications, alternative payment rails, or backup service channels can make the difference between a minor disruption and a full operational shutdown.
Ultimately, strategic planning ensures your customers never feel the disruption, even as the environment around them changes.
Regulations: staying compliant when the rules keep changing
If there’s one area businesses can’t afford to overlook during political uncertainty, it’s regulation. Sanctions lists change, compliance requirements tighten, and new rules can appear almost overnight. The UK’s move to a single sanctions list in January 2026, designed to simplify and clarify checks, is a good example of how fast the landscape can shift.
Keeping up with these changes manually can quickly become overwhelming. An oversight or delayed update can lead to heavy penalties, frozen transactions, or even the loss of operating licences.
That’s why automation is becoming essential. Having compliance systems that update regulatory lists and monitoring requirements in real time helps reduce risk and removes the constant pressure of manual checks. We provide this with our RemitONE Regulatory Compliance Manager (RCOM™).
It brings everything in one place – with over 350 global sanctions lists, real-time alerts, automated screening against 1.7M+ PEP records, and advanced reporting so teams don’t miss anything critical. It also provides full transaction visibility and configurable compliance rules to help regulators and financial institutions monitor activity, set specific rules, and stay ahead of regulatory changes without adding operational strain.
Compliance can run quietly in the background with the right tools, giving MSBs peace of mind to focus on growing.
If you’d like to know more about RCOM™, you can get in touch by booking a demo or emailing marketing@remitone.com for our brochure or any questions.
Diversifying corridors: never rely on just one market
In cross-border payments, relying heavily on a single corridor can quickly become a vulnerability. Especially when political tensions escalate, certain regions may face restrictions, sanctions, or banking disruptions, bringing transfers to an immediate halt.
But when one corridor slows down, having others already active allows your business to keep funds moving and revenue flowing.
Global remittance flows are expected to hit $5.4 trillion by 2030, driven by increasingly diverse diaspora communities sending money across multiple corridors worldwide. For money transfer operators, this creates opportunities to expand into new corridors that better serve their customers.
Diversifying corridors not only reduces operational risk; it also opens new revenue and strengthens connections with different diaspora communities.
However, a main challenge many banks and MSBs face is being slowed down by long licensing approval timelines when trying to enter new markets.
Many are turning to the Remittance-as-a-Service (RaaS) solution instead, as it allows businesses to enter new corridors in a matter of weeks while testing and adapting to new markets without the usual upfront commitment.
This makes it easier for MSBs to stay agile, respond to changing conditions, and gradually expand their reach, while continuing to operate within a compliant framework and explore new revenue opportunities across different corridors.
If you’d like to explore how this could enable faster expansion, you can book a call with our team to walk through it in more detail here: https://calendly.com/remitone-oussama/free-30min-consultation-website?
Building resilience for whatever comes next
Global uncertainties are realities the remittance industry will continue to face. While no business can predict exactly when disruptions will happen, the ones that stay ahead are those that build resilience into their operations through digitisation, strong compliance processes, strategic planning, and diversified corridors.
By putting the right systems and strategies in place, MSBs can continue doing what matters most: keeping funds moving for the communities that rely on them, no matter the external pressures.
If you’re looking to strengthen your operations and stay prepared for whatever comes next, explore the tools available through RemitONE, designed to support growth, stability, and compliance across global remittance operations.
You can book a call with our team or if you have any questions, email us at: marketing@remitone.com
Upcoming Webinar: Launch Cross-Border Remittance Services in Weeks with RaaS
Cross-border expansion is no longer just about where you grow.
It’s about how you grow.
Banks and fintechs today face mounting pressure to enter new corridors faster, reduce regulatory friction, and avoid committing years of investment before real demand is proven. Traditional expansion models — full licensing, infrastructure build-out, local partnerships, can be slow, costly, and complex.
But what if you could launch in weeks instead of years?
That’s where Remittance-as-a-Service (RaaS) comes in.
In our upcoming 30-minute webinar, we’ll explore how forward-thinking institutions are using RaaS to:
- Launch cross-border remittance services in weeks in the UK, Europe & US
- Test new markets before pursuing full licences
- Reduce regulatory and operational complexity
- Maintain control while scaling with greater flexibility
Secure your spot here: https://events.teams.microsoft.com/event/4058ee36-d33a-4ddf-9f68-4c4cf7895707@36d5614f-f651-4945-9632-7053acdae73a/registration
We’ll also examine how recent regulatory developments, including fast-track licensing frameworks, fit into the wider strategic decision-making process. When does it make sense to pursue your own licence? When is RaaS the smarter entry route? And where does a hybrid model deliver the greatest long-term advantage?
Who Should Attend?
This session is designed for:
- Fintechs scaling remittance services
- Banks planning international expansion
- Decision-makers evaluating speed, risk and long-term strategy
If cross-border growth is on your roadmap, this webinar will provide a practical, strategic lens on how leading institutions are rethinking expansion.
Join us for a clear, actionable discussion on how to launch smarter and scale with confidence.
Register now here: https://events.teams.microsoft.com/event/4058ee36-d33a-4ddf-9f68-4c4cf7895707@36d5614f-f651-4945-9632-7053acdae73a/registration
Episode 6: RaaS Explained – How Banks and Fintechs Can Expand Cross-Border Without Licensing
This year, something has shifted. Banks and large fintechs are no longer asking if they should expand cross-border—they’re asking how to do it faster? Reduce regulatory friction? Avoid locking yourself into multi-year commitments?
Some regions like the UK are looking to introduce a fast-track licensing regime, which offers provisional approval for up to 18 months until full authorisation is processed. While it’s a positive step, it’s only available for small fintechs and doesn’t remove the complexity that comes with entering new markets.
That’s why more money service businesses are turning to RaaS (Remittance as a Service) and in this episode we’ll be diving into how it can unlock new revenue and growth.
You’ll discover:
- Why adoption is accelerating – what’s changed, and why banks are reassessing their cross-border strategy now
- What onboarding really looks like – from qualification to integration and going live.
- New revenue opportunities – how to test corridors, capture more value, and grow without being constrained by provisional licences
- Choosing the right RaaS partner – the criteria that matter most when assessing flexibility, compliance, and long-term fit
Tune into the full episode
The Next Step for African Central Banks: Technology-Enabled Compliance Solutions
Across Africa, central banks are under increasing pressure to improve transparency and oversight in cross-border payments. As digital transactions grow, the need for real-time monitoring and reliable compliance tools has never been greater.
Common Challenges Regulators Face
Many regulators share similar problems:
- Limited visibility of FX rates applied by Money Transfer Operators
- Difficulty tracking USD and EUR inflows into the banking system
- Risks of structuring and smurfing in remittances
- Uncertainty around governing crypto-assets and stablecoins
- Pressure to adopt AI responsibly
- Balancing financial inclusion with strong compliance
The Solution: Introducing Regulatory Compliance Manager
Many central banks are now turning to technology to tackle these growing challenges. That’s why we at RemitONE developed our Regulatory Compliance Manager (RCOM™), empowering regulators and central banks to:
- Gain instant visibility of cross-border money movements and FX rates.
- Automate oversight with configurable compliance rules.
- Access actionable intelligence through advanced reporting and analytics.
With RCOM™, regulators can make proactive, data-driven decisions — turning compliance into a strategic advantage.
Those who move first are already seeing results. Find out how our solution can increase visibility for your central bank by booking a free call with Ababacar Seck, our Managing Director in Africa.
Power Up Your Platform: The Top RemitONE Features Driving Our Clients’ Success
What if the growth you’re chasing is already built into your system?
If you’re using the RemitONE Money Transfer Platform, we want to make sure you’re getting the most out of it to unlock its full potential.
Packed into your platform are powerful tools designed to boost transactions, build loyalty, reduce risk, and help you move faster. But if you’re not fully unlocking them, you’re missing opportunities.
Today, we’ll be sharing our clients features that consistently drive results and keep them ahead of the curve.
Let’s show you what’s possible.
Loyalty Manager: Keep Customers Coming Back
If you’re looking to boost retention and give your remitters a reason to keep choosing you—this is the feature to activate.
Loyalty Manager™ turns every transaction into an opportunity to reward your remitters. With this popular feature, your customers earn loyalty points every time they send money or refer a friend. These points can be redeemed to reduce transaction fees, which means every transfer becomes more affordable and more rewarding for them.
What makes it especially powerful is how customisable it is. You can set your own rules on how points are earned, based on what makes sense for your business, whether that’s based on transaction frequency, corridors, or even new customer referrals.
And when combined with Promotions Manager™, your customers can unlock even more by using loyalty points and promotions in a single transaction. The result? Greater satisfaction, higher engagement, and stronger brand loyalty.
Promotions Manager™: Smart Offers, More Transfers
If you’re running a money transfer business, you know that generic discounts don’t cut it. You need offers that actually move the needle — increasing transaction volumes, encouraging repeat usage, and giving customers a reason to stick with you.
That’s exactly what Promotions Manager™ is built for.
This feature puts you in full control, allowing you to set up intelligent, rule-based promotions that are targeted, timely, and effective. Whether it’s a festive seasonal discount for specific corridors, a reward for frequent senders, or a special deal for partners, this feature helps you craft promotions that match your business goals and your audience’s behaviour.
- Target smarter: Choose who sees your promotions based on corridors, transaction history, or user type.
- Incentivise more sends: Set up thresholds like “send 3 times, get a discount” to increase transaction frequency.
- Run timely offers: Activate short-term promos for holidays, local events, or marketing pushes.
- Maximise ROI: Avoid blanket discounts and focus on what works, boosting transactions without wasting budget.
It’s not just about discounts; it’s about strategy. Promotions Manager™ helps you reward the right behaviour, at the right time, with the right offer, building stronger customer loyalty and driving more transactions.
Risk Manager™ : Spot Risks Before They Become Problems
Risk is everywhere when you’re moving money across borders, but staying compliant doesn’t have to mean slowing down your operations or manually digging through data.
What clients love about our Risk Manager™ is it doesn’t just flag risks — it thinks ahead.
It gives you a dynamic, real-time view of who your riskiest customers are based on what they actually do — not just who they say they are. From sending to high-risk regions to sudden spikes in transaction volumes, our dynamic risk scoring system tracks behaviour patterns, adapts in real-time, and assigns weighted risk scores to both remitters and beneficiaries. The result? You can spot red flags early, act fast, and stay ahead.
It’s not just for compliance teams either, the Risk Score Rules Engine lets you set custom rules that reflect your business needs. And with detailed audit trails and downloadable reports, you’ll always be ready when the regulator comes knocking.
If you’re already juggling tight regulations and evolving risks, then it might be time to activate Risk Manager™ and make your life a whole lot easier.
Maker Checker: Double Verification for Safer Transfers
Mistakes in money transfers can cost more than just time; they can damage trust. Maker Checker adds a second layer of control to your operations by requiring one team member to create a transaction, and another to verify it. It’s a simple way to reduce errors, prevent fraud, and keep your financial processes rock solid and secure.
Built for compliance, peace of mind, and flawless execution.
Get more out of RemitONE — with hands-on expert support
Sometimes the real game-changer isn’t a new feature, it’s having someone by your side who knows your system and understands your goals to help you move faster.
That’s exactly what our Technical Customer Success (TCS) offers. It’s a personalised support experience built for teams who want to go further with RemitONE. You’ll have direct access to a dedicated Technical Customer Success Manager who becomes an extension of your team, someone who already understands your setup and can help you troubleshoot issues faster, scale with confidence, and get more out of the platform.
Whether it’s navigating technical challenges, implementing new features, or simply having a regular sounding board for improvements, TCS is designed to make your day-to-day easier and more effective. You’ll spend less time stuck in queues and more time getting things done.
It’s a flexible service shaped around your workflow, from quick weekly catch-ups to in-depth strategy calls. Whatever your rhythm, we’ll match it, so your team can keep moving.
Let’s take some weight off your shoulders and help unlock your full potential.
You’re sitting on the growth your competitors are already using.
These tools aren’t “nice-to-haves” they’re how leading money service businesses (MSBs) are pulling ahead. More transactions. More loyalty. More support.
If you’re already using RemitONE, it’s time to unlock the full power of your platform.
And if you’re not with us yet? Then let’s show you what’s possible.
Book a free demo and see how the world’s leading MSBs use our platform to grow every single day.
The Evolution and Impact of Digital Remittances
This article is brought to you in partnership with Visa.
The landscape of cross-border remittances has undergone a significant transformation over the past few
decades, moving away from being high-friction, expensive, and low transparency to being near real-time,
more cost-efficient, and more transparent.
The advent of digital remittance services has revolutionised this landscape. To enable this evolution, the
payments industry continues to make significant strides in the types of innovative solutions, the various
use cases, and the speed and costs of remittance services. This shift is reshaping how money is sent and
received globally, impacting millions of lives and economies.
The Digital Transformation
Digital remittances are now at the forefront of the industry, driven by advancements in mobile
technology and connectivity. Visa’s “Money Travels: Digital Remittances Adoption” Report found that
digital remittances are the preferred method among consumers across all surveyed countries, with 53%
of consumers turning to digital apps to send and receive funds around the world. According to the World
Bank, digital remittances are nearly 2% cheaper than cash remittances, which is a significant saving for
those sending money cross-border on a regular basis.
The benefits of digital remittances extend beyond just cost savings. These platforms offer speed, security,
and convenience, ensuring that funds are transferred quickly and safely. Of the estimated 200 million
migrants who send funds to their collective 800 million family members back home, many are turning to
digital methods, because app-based digital payments are considered the most secure means for sending
funds abroad1. This is particularly crucial for families who rely on remittances for everyday needs like
food, education, and medical expenses.
Economic and Social Impact
When these payments are digital, they provide an additional boost to economic empowerment and
financial inclusion. With advances in digital payments, families benefit from the lower cost of sending or
receiving money abroad. They can have money available in near real-time so that they can spend it
immediately on what they need. With the right guardrails in place, remittance firms and lenders can
work together to extend credit based on customer behaviour, increasing access to financial services that
immigrants lack when they first move.
While remittances can improve the living conditions of those back home, they also fuel growth rates of
receiving economies. 29 countries received over 10 percent of their gross domestic product (GDP) in
remittances in 20221, while seven received over 25 percent of their GDP this way2.
Future Prospects and Challenges
Despite the advancements, challenges remain. Many payment corridors still lack basic infrastructure like
electricity and internet connectivity, which is a barrier for millions in digitising their cross-border
payments.
Innovation within Fintechs and banks, the transformation of global remitters and capabilities of solutions
developed by global payment networks are focused on helping to bring seamless, secure, and rapid
digital remittances within reach. Expanded choices are also important in how digitally enabled migrant
workers can more easily compare providers and costs to choose the best options for their families. Visa
Direct, Visa’s real-time money movement network, is powering many of these new solutions by helping
facilitate the fast delivery of funds directly to cards, bank accounts, and wallets around the world3.
The evolution of cross-border remittances from traditional methods to digital platforms has had a
transformative impact on global economies and communities. As digital adoption continues to rise, it
holds the potential to further empower individuals and drive economic growth, provided the challenges
of digital infrastructure are addressed. The future of remittances is undeniably digital, promising greater
efficiency, security, and inclusion for millions around the world.
1Money Travels: 2023 Digital Remittances Adoption Report (visa.com)
3 Actual fund availability depends on receiving financial institution and region.
Meet Visa at IPR Global 2024
Joining as Platinum sponsors, you can meet Visa at our annual IPR Global event, where you can dive into deep conversations, explore potential partnerships, and discover the latest trends in the industry from leading influencers.
The top decision-makers will be there, so don’t miss this golden opportunity. Our spaces are limited, so seize your ticket now before it runs out at: https://global2024.ipr-events.com/
We look forward to seeing you!
Remittances: A Powerful Force for Financial Inclusion
This article is brought to you in partnership with Clear Junction, written by Dima Kats, Founder and CEO, of Clear Junction.
Given how much migration around the world has grown over the past two decades, and combined with technology making money transfers more accessible, remittance corridors, inflows and outflows have undergone significant shifts.
No matter where remittances are sent from and headed to, it’s vital that they are made with security and speed built-in. But many remittance providers are struggling to facilitate fast and cost-effective remittances due to high costs, FX conversion challenges, and logistical hurdles. And sadly, that means many people seeking efficient remittance services have struggled to access and afford them. On the other side are recipient individuals and families who depend on those services – they can’t afford to be faced with delays in receiving funds.
Traditionally, the main option for remittances were money transfer networks like Western Union or the post office. But these transfers are often slow to be processed, and in places where physical infrastructure is sparse, chances are that recipients in home countries need to be paid via non-banking payment rails. However, not all payment networks may be available or accessible in every region, limiting the reach of remittance services.
Another challenge is that many banks are hesitant to work with remittance companies due to the perceived higher risk associated with money transfer businesses, which leads to account closures or limited access to banking services.
High transaction costs, including fees associated with currency conversion, international transfers, and intermediary banks, can also eat into remittance profit margins. Finding cost-effective payment solutions that offer competitive exchange rates and low fees is a constant challenge. This means many remittances remain cash-based and therefore more prone to fast-changing FX conversion rates eating into remittance balances and provider profitability.
Fluctuations in exchange rates can impact the profitability of remittance companies, especially those operating in multiple currencies. Remittance companies need access to services with the best FX rates on the most commonly used currencies like USD, EUR or GBP in order to give the best value to their customers.
On top of all of that, employing secure and proven technology is of paramount importance, as is the knowledge that when funds are sent, they will appear in the recipient’s account in as little as a few minutes.
That’s why Clear Junction’s platform is designed to minimise the operational and financial challenges of scaling up remittance FinTechs. We understand the difficulties faced by remittance companies in establishing accounts. So, our collection accounts enable remittance companies to hold a monetary balance with Clear Junction, enabling them to gain access to domestic and international payment networks across the UK, Europe, and US and benefit from competitive FX rates when conversion is needed.
Clear Junction provide a transparent fee structure, which gives remittance companies full visibility of the costs that they will incur on making cross-border payments – unlike some traditional methods when you do not understand the fees until the transaction has been received.
With remittances worth billions of EUR and GBP flowing through our pipes, we’re trusted by a wide range of players to provide reliable technical infrastructure, fast transaction routing, and low FX rates that enable people to send money home, to where it’s needed most – at the fingertips of recipients.
What’s more, Clear Junction can help remittance companies extend their reach outside their domestic markets, enabling them to access and build strong relationships with counterparties in various geographies. Our existing clients operate as a network and often times we are pleased to see internal settlements within that network.
Amongst the advantages offered by Clear Junction is the upcoming roll out of cross-border settlements using stablecoins. Using blockchain and pegged to a reserve asset like US dollars, stablecoins offer real-time settlement and remove the intermediaries that add to fees and risks. Stablecoins hold the potential to fundamentally transform remittance flows to underserved and emerging markets, empowering more financial inclusion and economic development, at societal and global levels.
With Clear Junction, you’re guaranteed clear advantages in your remittance offerings: reduced transaction costs, faster and more secure remittance flows, and the power to reach more customers. Get in touch with us at https://clearjunction.com/contact/ if you’d like to find out how we can help your business.
Meet Clear Junction at IPR Global 2024!
Joining as Platinum sponsors, you can meet Clear Junction at our annual IPR Global event, where you can dive into deep conversations, explore potential partnerships, and discover the latest trends in the industry from leading influencers.
The top decision-makers will be there, so don’t miss this golden opportunity. Our spaces are limited, so seize your ticket now before it runs out at: https://global2024.ipr-events.com/
We look forward to seeing you!
Africa Remittances: Traversing the New Frontier | IPR Global 2023
This insightful session will explore the evolving landscape of remittances in Africa, with a key focus on the transformative impact of mobile money services and e-wallets. Our panel of experts will delve into topics like the role of innovative technologies, financial inclusion, regulatory challenges, and the potential to reduce costs and promote economic development through remittances.
Discover how these digital financial tools are reshaping financial ecosystems, empowering underserved communities, and fostering cross-border economic integration across the African continent.
Moderator
- Priscilla D´Oliveira Friedman, COO, CrossTech
Panellists:
- Temiloluwa Adesina, Senior Product Manager, Flutterwave
- Ababacar Seck, Managing Director, Africa, RemitONE & IPR
- George Boateng, Chief Operations Manager, Unity Link Financial Services Limited
- Reynell Badoe, Head, Everyday Banking, Stanbic Bank Ghana LTD
What is the current landscape of remittances in Africa, and how has it evolved over the past decade?
Across the continent, every country heavily relies on inbound transactions, creating a diverse landscape characterised by various players, services, business models, and remittance types, including traditional, digital, and informal methods. Despite the challenges posed by the COVID-19 pandemic, the remittance market in Africa has proven to be remarkably dynamic and resilient, defying expectations of a decline in transactions. Comparing the present situation to the early 2000s, Ababacar highlighted the transformation from a market restricted by exclusive contracts favouring big players in international transactions to a more open and inclusive space that allows for domestic, regional, and international remittances. In the past, high prices were a significant barrier, but the advent of digital remittances has started to address this issue, although cash remains important due to cultural and behavioural factors.
The region’s people embrace digital tools but still value the human element. For example, using digital wallets for making in-person purchases keeping the face-to-face experience intact. It’s a reminder that, even in our tech-driven world, the human connection remains a crucial part of how Africans handle their finances.
There has been growth in various sectors, such as mobile money, payments, sending goods, and B2B remittances, indicating the expanding horizons of remittance services. Furthermore, the informal market, once overlooked, is now recognised as a major untapped opportunity in the evolving landscape of remittances in Africa.
George recalls how in the past there was a heavy reliance on fax for transactions, which could take up to a week, whilst the shift to bank deposits seemed promising for quicker transactions, the uptake was low due to financial exclusion. The prevalence of cash transactions in Africa posed challenges for cash pickup in banks, requiring identification. However, the digital revolution, with its elimination of such barriers, has unlocked the potential. The increasing role of Mobile Network Operators (MNOs), expanding rapidly across Africa, is a key driver of this growth, making the remittance landscape more accessible and promising for the future.
Reynell delves into the changing dynamics from a banking perspective. Historically, banks in Africa primarily focused on settlements, with the actual business of money transfers being led by Money Transfer Operators (MTOs) and Payment Service Providers (PSPs). Remittances, play a crucial role in contributing significantly to the GDP of African countries, with figures ranging from 5-6% in countries like Ghana and Nigeria, and up to 10% in other regions. This underscores the economic importance of remittances in the African context.
The regulatory environment in Africa presents a hurdle, slowing down the pace of innovation for banks. Unlike MTOs, many banks in Africa still operate in person, leading to higher operational costs. This insight showcases the need for adaptation and innovation within the banking sector to keep pace with the evolving remittance landscape in Africa. Despite these challenges, Reynells perspective highlights the immense significance of remittances for African economies and the imperative need for banks to navigate regulatory complexities to actively participate in the changing dynamics of the remittance market in the continent.
What should companies be thinking about when entering this market?
It’s crucial to have a well-thought-out strategy when venturing into the African remittance market. Licensing requirements, play a pivotal role in determining the speed of market entry. Partnerships are another key factor that can significantly accelerate the entry process, emphasising the collaborative nature of the industry.
You can easily tap into reliable partners to fast-track your entry into the market through RemitONE Connections to secure you with an instant business community that would take months and years to build yourselves within the Africa region. This also means you must have flexible technology with strong API integration capabilities to connect, RemitONE’s Money Transfer Platform is both modular and scalable. For more information get in touch with us at sales@remitone.com.
Temi suggests, a targeted strategy focused on specific regions is more effective rather than adopting a broad approach. For instance, in francophone regions of Africa where french is widely spoken as a second language, similar regulations and cultures prevail. By tailoring strategies to these specific regions with shared characteristics, one can enhance the effectiveness of market penetration.
George reassures that entering the market shouldn’t be daunting as specialists are available in every country to help guide you through the loops. However, a thorough understanding of the local customer dynamics, including their behaviour, attitudes, and cultural nuances is essential. He advocates for a more strategic approach that involves aligning with the demographic profiles of potential customers that resonate with the services your company offers. This perspective underscores the importance of cultural sensitivity, customer-centric strategies, and long-term relationship building as key considerations for companies seeking to successfully enter and navigate the African remittance market.
What innovative technologies and platforms are reshaping the way remittances are sent and received in Africa, and how are they increasing financial inclusion?
Mobile money has significantly altered the dynamics of remittance transactions with the help of the widespread ownership of mobile devices, coupled with increased telecommunications access, which has catalyzed a notable surge in remittances across the continent. Partnerships between remittance providers and telecommunications companies like Safaricom, have also played a pivotal role. This collaborative approach has proven instrumental in fostering innovation within the industry, creating a synergistic environment where different players work together to enhance services and accessibility.
Furthermore, the adoption of stablecoins, with the involvement of companies like Stellar and Ripple, is an emerging trend. These digital assets provide stability in value and are being utilised by companies to facilitate remittance transactions, offering an alternative to traditional currency-based transfers.
Interoperability, between mobile wallets, bank accounts, and cash through partnerships, is another critical aspect of the evolving remittance landscape in Africa. The seamless connectivity between various financial instruments and channels ensures a more inclusive and user-friendly experience for individuals sending and receiving remittances.
What challenges do African diaspora communities face when sending remittances, and how can these obstacles be addressed to improve the flow of funds?
High costs associated with remittances into Africa continue to persist, irrespective of the sending country, attributable to both financial and regulatory obstacles. Despite the advent of mobile money, Reynell believes certain African countries still heavily rely on physical locations such as banks or MTOs, posing difficulties for beneficiaries in accessing funds.
Additional challenges faced by the underbanked, particularly in rural areas and villages, where limited access to banks poses a significant barrier. Foreign exchange (FX) fluctuations were identified as another obstacle, leading to reduced amounts being received by the recipients. In addition, regulatory challenges also extend to the senders, particularly undocumented migrants who wish to send funds. The need for proof of address or source of funds presents a barrier, hindering their ability to send remittances until these documents are provided. To mitigate this challenge, George proposes that an alternative solution would involve embracing informal money transfer methods as well as the increasing interoperability between MNOs which will provide new opportunities for more efficient and cost-effective money transfers.
Ababacar further observes that while Africans can travel between countries with just their ID, the requirement for a passport when sending money presents a misunderstanding and inconsistency that act as barriers to entry for remittances from the diaspora. This discrepancy in identification processes poses a challenge, adding an unnecessary layer of complexity for individuals attempting to send funds.
He further points out the lack of interoperability across the continent. The absence of a unified system restricts some diaspora communities from utilising MNOs as a viable option for remittance transactions. This limitation not only hinders the accessibility of services but also contributes to the overall challenge of navigating the remittance landscape.
Also, within many MNOs, there isn’t an available option to transact money in different currencies. This lack of flexibility in currency options adds another layer of complication for the diaspora communities attempting to send funds across borders.
To tackle these challenges, improving identification processes by harmonising them with the adaptable regulations in Africa may help alleviate inconsistencies in requirements. Furthermore, fostering interoperability across the continent would amplify the accessibility of remittance services for diaspora communities. Urging MNOs to offer transaction options in various currencies would significantly ease the flow of funds, catering to the diverse needs of the African diaspora.
What innovations are emerging within the mobile money ecosystem that have the potential to further enhance the convenience and efficiency of remittance transactions?
Mobile money services have notably increased accessibility by introducing digital wallets accessible through mobile phones. These mobile wallets have evolved beyond simple remittance tools and can now function similarly to bank accounts, offering users the ability to engage in activities such as loans, savings, bill payments, and more through dedicated mobile apps.
The widespread adoption of mobile wallets has spurred further innovation, with the integration of technologies like artificial intelligence (AI) to assess credit scores. This, in turn, enables the provision of loans and overdrafts based on users’ spending patterns, showcasing a holistic approach to financial services within the mobile money ecosystem.
George highlighted the cultural integration of mobile wallets in African daily life, noting that some individuals receive their salaries exclusively through mobile wallets. This trend has led to mobile wallets becoming integral to people’s lives, so much so that even transport providers can be paid using mobile money. The efficiency and convenience offered by mobile wallets have positioned them as more than just a substitute for traditional banking; they have become the preferred choice for many. Euromonitor International found in the sub-Saharan African region, there were over 600 million registered mobile money accounts, facilitating transactions exceeding USD 600 billion in 2022, with it expected to grow even more in the coming years, especially with the help of central banks reducing barriers to entry.
Moreover, George speculated on the future trajectory, foreseeing a potential end to the dominance of cash in the coming years. However, he acknowledged that this transformation depends on continued investments in the economy and the infrastructure required for the digital revolution to take root.
Priscilla added to this narrative by drawing parallels with Brazil, where digital payments, exemplified by Pix payments, have also been gaining prominence. These digital payment methods contribute significantly to driving economic growth, simplifying transactions, and mirroring the trend observed in the African mobile money ecosystem.
What next?
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The Silicon Valley Bank Collapse: Challenges and Opportunities in the Money Transfer Industry?
Silicon Valley (SVB) was the go-to bank for many tech startups and its recent fall has left a sense of uncertainty within the community, with many wondering if this will impact their own banks. In this article we’ll focus on the aftermath of SVB’s collapse, exploring what it means for the industry and the opportunities it offers for innovation and advancement in the payments and remittance spaces.
First, let’s backtrack to how this happened in the first place, and explore the warning signs. The foreshadowing of SVB’s downfall began with their investment in treasury bonds which later hit them with a major blow as interest rates spiked up in an attempt to slow down inflation. The unprecedentedly sharp increase in withdrawals outnumbered their deposits as venture capitalists were investing less in startups whilst customers were withdrawing their funds at an accelerated pace. This made matters worse for SVB, as they had to provide the funds to compensate for the loss, and in desperation, they sold their bonds at a much lesser value, resulting in a huge loss of $1.8 bn.
What effect has this had on the money transfer industry?
Challenge #1: Slower Operations and Increased Costs
SVB’s collapse caused considerable hindrances for payroll, resulting in delayed or unpaid payments to employees. This also may have led to a shortage of staff and disruptions to money transfer companies’ day-to-day operations, leaving businesses understaffed and unable to resolve customer issues or complaints.
As a result of these setbacks, customers may have experienced missed or delayed transfers, which must have had a serious impact on the customer’s trust and confidence in the money transfer market. Businesses may have suffered from a decline in transaction volumes and revenue slowdowns as a result.
Solution #1: Rebuild Customer Relationship
Money Transfer Operators (MTOs) must win back customer trust. They can achieve this by investing in a secure and scalable technology platform that is built on a robust infrastructure. Additionally, offering a range of services beyond simply money transfers (e.g. utility bill payments, wallet transfers, airtime etc), can also help gain customer trust.
MTOs can also strive to offer even more competitive rates and lower transaction fees, which not only attracts new customers but helps retain trust with existing ones. Cost reduction can happen by investing in technology that automates processes and compliance procedures and opens up new revenue-sourcing channels such as mobile apps and online portals.
Challenge #2: Difficulty for Immigrant Communities
The remittance market thrives hugely on transactions by immigrants who send money to their home countries.
With the exit of some smaller players, larger companies can gain more bargaining power to increase the costs of fees and charges; this burden is then passed onto the end customers, making it more difficult for the latter to send money to their loved ones.
Solution #2: This problem may, in fact, prompt a change in customer behaviour. For example, challenging circumstances can often push people to explore alternate routes which they may have been hesitant to use before, such as mobile money. This may result in traditional banks losing some of their dominance over digital banks, allowing the latter to gain market share, especially as they often have lower fees and are more convenient.
In addition, digital banks are continuing to gain ground in the money transfer market; this may likely continue as more people become tech-savvy and embrace its benefits. It is crucial for MTOs and digital banks to evolve and adapt to meet customers’ changing needs by monitoring the market and consistently updating their marketing strategy.
Challenge # 3: Tighter Regulation
The Federal Reserve introduced a new program to help tackle instability and safeguard companies impacted by SVB’s downfall. Similarly, this could inspire money transfer regulators to also introduce tighter rules and regulations around monitoring and tracking transactions using reliable technology platforms.
However, there are some downsides as well, including a slowdown in operations and higher costs. A rise in compliance expenses may also result in companies having to exert more money to invest in new technology or additional staff to comply with regulations. This is especially challenging for smaller companies that may not have sufficient funds. It can also lead to increased delays in transactions as agents and companies need to perform additional checks.
Solution #3: Despite these challenges, this could in fact improve compliance practices in many companies. With reliable technology platforms to enforce transactional monitoring and process automation in place, companies can reduce the risk of fraud and improve their security measures. All of these improvements will aid in strengthening the money transfer industry and allow it to become more reliable than ever.
The Outcome for the Industry: Innovation Opportunity
Despite the challenges brought about by the recent instability in the payments and money transfer industries, this situation can also stimulate growth opportunities.
As areas of weakness within businesses are revealed, a better understanding of how to improve processes and systems will also become apparent. In addition, the retreat of some tech companies will provide opportunities for new players to enter with fresh ideas, products and services. Simultaneously, it encourages industry players to collaborate in finding solutions as each can provide their area of expertise to resolve the problem, creating beneficial progress.
RemitONE and other tech providers can help companies affected by the SVB collapse.
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