With populations having more and more access to the internet, places like the countries that make up the Southern African Development Community are noticing an increase in digital remittances.
“Digital disruption in international person-to-person remittances is well underway. New research estimates that international digital remittances will exceed US $300 billion globally by 2021, making up 44% of total formal international remittances, and up from 36% in 2018. Thanks to high rates of mobile phone penetration and growing internet access, digital players are not only gaining ground, but they are also forcing “traditional” incumbents to expand their digital footprint.”
Although there is growth in populations changing digital financial activity, there are still some obstacles to overcome.
“Despite this encouraging trend, the combined global market share of digital disruptors remains small; and in Southern Africa, their presence has not yet placed significant downward pressure on remittance costs. In fact, the costs to send remittances to, from and within Southern Africa are among the highest in the world. As shown in the figure below from the World Bank Remittance Prices Worldwide, in Q3 2018, the average cost to send US$200 to SADC countries was 11.94%, compared to 8.96% in Sub-Saharan Africa (SSA) and 6.94% globally.”
Click here to read more: http://blogs.worldbank.org/psd/what-s-holding-back-digital-disruption-remittances-southern-africa
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