With a lightning speed undertaking of new financial services in Africa, many countries have seen the emergence of a number of new players. The money transfers market, initially led by larger international entities, is now a competitive landscape littered with both large and small enterprises.
Modern day inter-country money transfer operators make use of mobile platforms and agent stores unlike traditional finance models. This money transfer model makes international money transfer more accessible to the people in Africa, allowing greater trading options in and outside of the continent. Mostly used to send money to families and by small, expanding businesses to receive international payments, the nature of these transfers creates a new age of African financial freedom and fairness.
Launched over a decade ago, it has become increasingly adopted and adapted to suit each country’s specific economic and social needs. Where its initial purpose was to enable cross-border money transfer, its evolution has enabled it to become the answer to a host of industry issues most never knew existed.
The Little Guy with a Big Advantage
Companies like MamaMoney who took a ‘start-up’ approach have seen success amongst trade focused countries like Ghana, Nigeria, Tanzania, and Zimbabwe. Started with a social motive to ensure that more money ended up in the hands of the recipient, their product gives more people access to affordable financial services with lower fees than traditional transfer methods.
Others like Mukuru and Wave make it easy to transfer money from Africa to neighboring countries and further afield. They combine mobile technology and the low-cost transfer thinking to enable Africans to send money back to their families. Wave’s services are mainly used by Kenyans while Mukuru services largely in Southern Africa. These kinds of companies have stimulated small business growth and continue to increase economic development.
Big Players in a Small Man’s Game
Well-known services like Wari and Western Union are the leaders in the pan-African transfers market. Wari takes most of the market share in West Africa with more than 80% of the money transfer market in Senegal. Using their offshore capabilities and western infrastructure both companies have generated a steady success.
Standard Bank and Moneygram‘s partnership is another more localized example of a product that’s gained a large adoption, seeing most of its success in South Africa, Lesotho, Swaziland, and Namibia. More recently launching deposit functionalities for transfers into Nigeria from European countries.
While the larger players have certainly made the most presence in Africa’s money transfer game, their ongoing growth has not been as successful as projected. The more recent adoption of independents has created a greater demand for product innovation and encouraged healthy competition in this growing market where fees really matter.
Big or small, as monetary transfer capabilities develop in these countries, every piece of this revival creates new facets in this complex continent’s ‘Financial Rising’.