New research from WorldRemit reveals that the Zimbabwean diaspora could be losing up to $9 every time they send money home this festive season due to the high cost of sending money through traditional remittance channels.*
Last year, Zimbabweans living abroad sent home over $1.8 billion and the run up to Christmas is always one of the busiest times to send money. New data from WorldRemit reveals that, by switching from traditional offline money transfer services to lower cost digital channels, thousands of Zimbabweans could receive an extra Christmas present this year.
The savings were highest when sending from New Zealand to Zimbabwe, with an average saving of nearly $9* – enough to buy a hamper of groceries for Christmas in Zimbabwe.
Transaction costs are only part of the story and a significant challenge at this time of year is travelling to an agent during opening hours. With approximately one quarter of the Zimbabwean diaspora population living in Europe, the United States and Canada, before the advent of app and web-based money transfer services, thousands would be facing near freezing temperatures to travel to an agent to pay in money.
Equally, WorldRemit data suggests that their customers sending to Zimbabwe send money several times a month. When it costs around $3 to travel from somewhere like Bindura to Harare and takes over 2 hours to travel there and back, Zimbabweans can easily waste half a day of time each month just travelling to pick up money. Savings on travel alone during the festive season could be enough to buy several litres of cooking oil and a couple of chocolate bars.
Pardon Mujakachi, Head of Sub-Saharan Africa at WorldRemit, said:
“Spending money just to collect money wastes precious time and money for families across Zimbabwe and creates added stress – particularly if you don’t know if you’ll receive the full amount in dollars. So, we have partnered with over 15 payment services to create the widest network of over 200 cash pickup points across the country, where money is paid out in full.”
A recent poll by WorldRemit revealed that eight out of ten people found that switching to digital channels has made money transfer simpler not just for senders, but also for their recipients. However, the majority of global remittance flows are still going through informal channels.
Companies like WorldRemit are working hard to help more people to move to more cost-effective and convenient money transfer methods. The incentives on offer for existing customers who refer a friend to WorldRemit could be enough to buy a scarf or a pair of shoes.
Pardon Mujakachi said: “Sending money is an important way for many people spending Christmas away from home to connect with their loved ones and play a part in the festivities back home even when they can’t be there in person. Yet, taking time out of work to travel to agents to send and receive money, can make Christmas a time of stress rather than joy.”
By enabling our customers to send money for collection as US dollars in a few taps from their phones and to track their transfers so they know when it’s ready for collection, we can take the stress out of sending money home at Christmas.”
