Byline by: Gbenga Okejimi, Country Manager Nigeria & Ghana
ACCRA, Ghana 9 November 2022,-/African Media Agency (AMA)/-A combination of rapidly evolving technology and the restrictions imposed by the COVID -19 pandemic has resulted in nothing short of a revolution in the online money transfer sector.
Globally, there have been drastic shifts in how people pay for goods and services, with electronic payments increasingly displacing traditional cash and more recently, cryptocurrency and digital currencies emerging in the market. In Ghana, financial technology and mobile money markets have grown significantly, with mobile money becoming the main drivers of the country’s financial services since its commencement in 20091.
Additionally, Boston Consulting Group noted, the number of active mobile money accounts increased from 14.7 million in February 2020 to 17.5 million in February 2021. Ghana’s total mobile money transactions also catapulted from 193 million in February to 295 million in February of 2021 showcasing the boom in the sector.
The movement has been truly significant at all levels of society, with users taking advantage of rapidly evolving technologies such as mobile wallets and contactless cards to make payments and move their money around the globe.
According to the World Bank, mobile money accounts drove a massive increase in financial inclusion in Sub – Saharan Africa as two–thirds of adults worldwide now send or receive digital payments, with the share in developing economies increasing from 35% in 2014 to 57% in 20212.
For many in Western society, the acceleration in technology makes for an easier and more convenient experience when dealing with digital remittances. However, for those citizens of emerging countries, the innovation and growth surrounding the global payments sector result in a wide range of benefits.
Digital remittances are a lifeline
In 2020, remittances in Ghana increased by five percent to $3.6 billion as many communities relied on their relatives living abroad to support them financially3. During this period, remittances sheltered many Ghanaian families from the challenging economic situation that COVID-19 brought.
Digital money transfers have now become a lifeline for many recipients, but on a broader level, they also contribute to the economic buoyancy of many countries across the globe. According to the UN, international remittances contribute to achieving 12 out of 17 Sustainable Development Goals, with a 10% increase in per capita remittances leading to a 3.5% reduction in poverty4.
An adequate system is needed to make sending money abroad a secure and simple procedure. Online money transfers help countries gain financial inclusion in emerging markets, thus improving economic development and alleviating poverty.
Banking for the unbanked
Until very recently, migrant communities faced several stressful challenges when sending money abroad. Long queues, unfamiliar paperwork, and sky-high fees were normal hurdles at the beginning of a transfer that could end up taking weeks to process. Once the money had finally reached its destination, the recipients would then need access to banks or shops to collect their cash.
Today, with digital payment services like WorldRemit, people can receive money in a matter of minutes in the form of bank transfers, airtime top-up, cash pick up and transfers to their mobile wallets.
These options that allow people to choose how to receive their money are particularly important in countries like Ghana, where 7.3 million of the adult population remains unbanked5.
Fortunately, this choice is facilitated by a boom in cheap and widely available smartphones that allow consumers and small enterprises to seamlessly transfer money at the touch of a button. Aided by FinTech vision and investment, Africa has been transformed into a world leader in mobile money. Again, the economic upshift facilitated by the new technology has contributed to a drop in the number of households living in poverty.
A Safe and Convenient Service
Digital payments service, WorldRemit uses industry-leading technology to enhance protection for online money transfers. This technology is also swift, meaning that most transfers are ready within minutes.
The increase in secure digital remittances, especially mobile-to-mobile transfers, has lowered the need for cash transactions. Consequently, opportunistic crime in many cash-heavy markets has been reduced, however, cybercrime remains a very present threat, which money transfer companies must work hard to combat.
Moving forward together
The transition to digital payments and online money transfers has already had a positive impact on migrant communities and emerging countries.
This transition has made the process of sending remittances easier and more secure. It has also lowered the barriers for financial inclusion in emerging countries like Ghana by allowing people without bank accounts to receive money with ease.
By offering flexible ways of sending and receiving money, more people around the world will be able to access financial services and ultimately free themselves from the manacles of poverty.
Find out how WorldRemit can help you move your money around with online digital payments
Distributed by African Media Agency (AMA) on behalf of WorldRemit.
Notes to Editors
1. Chambers and partners. Fintech 2022. March 2022
2.World Bank Group. Covid – 19 Drives Global Surge in use of Digital Payments. June 2022
3.AMPEX. Remittances to Ghana to hit $4.5bn in 2022 – Fitch Solutions. April 2022
4. UN. Remittances and the SDGs. June 2022
5. CIPESA. Financial Inclusion in Africa in an Era of Internet Shutdowns. November 2019
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We disrupted an industry previously dominated by offline legacy players by taking international money transfers online – making them safer, faster and lower-cost. We currently send from 50 countries to recipients in 130 countries, operate in more than 5,000 money transfer corridors worldwide and employ over 1,200 people globally.
On the sending side, WorldRemit is 100% digital (cashless), increasing convenience and enhancing security. For those receiving money, the company offers a wide range of options, including bank deposit, cash collection, mobile airtime top-up and mobile money.
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