Senditoo has cut its remittance fees, meaning that all customers who send money to Zimbabwe will not be charged for their transactions. This will make the company one of the cheapest money transfer providers.
The remittance industry, which depends on migrant workers sending money home, looked particularly vulnerable at the beginning of the pandemic and in April, the World Bank predicted that remittance volumes would decline by 20% during 2020 – the sharpest decline in recent history. However, with millions of people across the world confined to their homes by lockdown, Senditoo saw a surge in demand, particularly with their home delivery service.
Takwana Tyaranini, co-founder of Senditoo said: “We are continually finding new ways to respond to the rising demand of our service. This is just another step in growing our vision of providing our customers with an affordable, convenient and accessible facility.
“Zimbabweans in the diaspora are a key part of our business and continue to drive its exponential growth. In the last five months, the demand for remittance services to Zimbabwe has increased, particularly our delivery service in Harare and Bulawayo. This new incentive creates an opportunity for expansion and a service that customers – old and new – can rely on.”
For decades, money transfer transactions were dominated by mainstream banks and incumbents like Western Union who currently charge approximately £3.00 for transactions to Zimbabwe.
Until recently, it was normal to pay up to 10% in fees and commission to send money abroad. However, digital remittance providers have undercut traditional players, often charging less than 3%. In spite of this, it has still been a challenge to convince customers to leave their local money transfer shop behind even with the disruption of global lockdowns.
“There is clearly strong price competition in this space and we need to encourage technological innovation. Mobile money is transforming the financial sector in many countries and I believe emerging technologies will be influential in extending direct person-to-person, phone-to-phone money transfers across borders, lowering costs at the same time. We need to champion these innovations and this is one of our strategic steps,” said Tyaranini.
Remittances to developing countries are worth nearly half a trillion dollars – that’s three times the level of aid – and have continued to quadruple since the turn of the century. Reducing fees for the global average could mean an extra $1 billion reaching families in Southern Africa.
Ibrahima Soumano co-founder of Senditoo said that remittance companies need to empower migrants by helping them make informed choices about the services they use. Adding that removing fees is one of the most effective ways to retain customers and that action at all levels is required in countries that are net senders and net recipients of remittances.
For more information about Senditoo’s services visit www.senditoo.com.