Why Do Kenyans In The Diaspora Love Digital Remittance Platforms?

By Soko Directory Team / Published March 20, 2023 | 7:15 pm




KEY POINTS

World Bank data shows in 2020, the average global cost of sending $200 was 6.5 percent – more than double the target set by the UN.


WorldRemit

KEY TAKEAWAYS


Remittance providers such as Zepz Group are consistently looking for ways to keep transfer costs low and on average are almost half the cost (46%) of sending through banks.


Digital money transfer services are now the preferred remittance channel for millions of Kenyan migrants living and working in the diaspora, thanks to their online nature that allows migrants to send and receive on their own schedule, in their preferred way.

Data from Zepz Group shows that its users globally sent almost $2 billion USD to Kenya in 2022 through its two digital money transfer channels, WorldRemit and Sendwave. In comparison, Zepz users sent over $500 million to Zimbabwe, $300 million to Cameroon, and more than $190 million to South Africa during the period, making Kenya a top market for digital remittance flows into Africa.

There are several reasons why digital platforms are more popular for sending money back home than traditional brick-and-mortar channels that rely on a physical presence. Below are the main reasons to consider switching to digital finance solutions for your money transfer needs:

Quick, secure, and convenient

Digital transfers are fast and convenient as senders can complete transactions in a few simple steps from the mobile app or web browser and receivers can choose their preference on how to receive the money. Digital transfers are also extremely secure as they are run by licensed and regulated firms, complying with all local authorities. As an example, WorldRemit is licensed to provide international money transfer services in multiple jurisdictions, including the UK, US, EU, Australia, and South Africa, among others.

Affordable and transparent

The United Nations has set clear goals to increase sustainability in developing nations, including introducing a target to reduce the average transaction costs of international remittances to less than three percent by 2030. By doing this, remittance values will increase and the recipient will receive more money to further pay for their daily expenses, medical bills, and education, and build financial independence.

Currently, World Bank data shows in 2020, the average global cost of sending $200 was 6.5 percent – more than double the target set by the UN. The benefit of digital remittance services is it does not require the financial upkeep of a physical store and therefore can provide those savings to customers through competitive fees and rates. Remittance providers such as Zepz Group are consistently looking for ways to keep transfer costs low and on average are almost half the cost (46%) of sending through banks.

Multiple ways to receive money

Digital money transfer services also give those receiving funds multiple payout options; bank transfer (in KES or USD), mobile money, cash pickup, and/or airtime top-up. With WorldRemit, for example, senders can make instant transfers to the receivers’ registered mobile money account number.

The process of sending money across borders over digital remittance platforms is simple, fast, and affordable. These factors have made digital channels increasingly popular with Kenyans abroad.




About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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