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Send Money Africa
Developing Markets Associates
Chris Gerrard
April 2012


Send Money Africa
AIR Project
Main Findings

Send Money Africa

Send Money Africa, established in 2011
Funded as part of the African Institute for Remittances (AIR) Project
AIR Project objective:
“Develop the capacity of the Member States of the African Union, remittance senders and
recipients, and other stakeholders to implement concrete strategies and operational
instruments to use remittances as development tools for poverty reduction. “

African Institute for Remittances
(AIR) Project
The project is led by the African Union, supported by the World Bank and the EC in
cooperation with the African Development Bank and the International Organisation for
Migration (IOD). Launched in 2010, project activities include:
Providing technical assistance to government institutions
Carrying out training and capacity building programs
Studying remittances flows within Africa, which includes North Africa
Conducting policy research and dialogue and sharing information on how remittances
can contribute to the development of African countries
Developing content and technology platforms for country-based payment and
settlement systems for remittances
Developing partnerships between African central banks and remittance service
providers and non-bank correspondent agencies to improve financial access
Disseminating data and research findings

G8’s 5x5 Initiative
Average Remittance Costs for
sending USD200, Source RPW

Remittances into Africa
The World Bank estimates that about
120 million people in Africa receive
money from about 30 million friends
and relatives who have left their home
Official estimates put
remittance flows into Africa at around
the US$40 billion mark in 2010, making
them the continent’s largest source of
foreign capital after FDI.
Lack of choice in these markets keeps
prices high and allows informal transfer
methods to flourish.
In addition, when it comes to choosing
which operator to use to send money
home to Africa, too often migrants do
not have the necessary data to make
an informed choice.

Send Money Africa

Send Money Africa provides data on the cost of sending and receiving relatively small
amounts of money from selected countries worldwide to a number of African
countries, as well as within the African continent.
50 corridors, from 15 send countries to 28 African receive countries
Tracks remittance prices over time on a monthly basis

Send Money Africa
The objective is:
to increase transparency in
the market
To provide migrants with
complete and reliable
information on all the
components of the
to stimulate competition
among the service providers
and ultimately induce a
reduction of the costs.
Remittance senders and recipients
will benefit transparent, efficient, less
costly remittance

Corridors in the Sample
Send countries
N etherlands
South Africa
Saudi Arabia

Receive countries
D R Congo, Morocco
Ghana, Kenya, Zimbabwe,
Algeria, Morocco, Cote D’Ivoire, Mali, Senegal, Tunisia
Ghana, Morocco, Nigeria
Ethiopia, Morocco, Nigeria, Senegal
Uganda, Rwanda
Ghana, Morocco, Nigeria
Angola, Botswana, Lesotho, Malawi, Mozambique, Swaziland,
Zambia, Zimbabwe
Ghana, Kenya, Nigeria, Sierra Leone, Somalia*, South Africa,
Tanzania, Uganda, Zimbabwe
Cape Verde Ethiopia, Ghana, Nigeria, Kenya

Send & Receive Countries

Send Countries

Receive Countries

Sourced in the field through mystery
Price information published monthly
Useful information on:
the method used,
the actual amount of money
received in local currency,
the time needed for the money
sent to be available to the
the place where the money can
be collected,
the exchange rate applied to
the transaction.
Information helps consumers to
compare services, fees, and speed of
the remittance service and choose the
provider which match their needs.

Main Findings
570 different services included in the
Mainly MTOs in the sample (62%)
76 services (13%) were found to be nontransparent in February 2012 (listed as
Total average cost of sending money into
Africa 11.2% of the send amount (for
sending USD200)
More expensive than the global average
(9.3% of the send amount – source

Selected Average Total Costs

SMA February 2012

Corridor Costs

Corridor Costs
Breaking average costs into fee and FX
margin - the majority of send countries
the fee constitutes the larger proportion
of the total cost
Zambia has (almost) consistently been
the most expensive receive market,
exception in Dec 2011
Significant movements in the cost of
sending money to different African
receive countries

Main Findings
Instant service is more expensive than next
6 days or more most expensive type of
remittance service
Cash to cash =33% of services sampled (avg
cost 9%)
More competition in the alternative methods
of transfer

Estimating Data
Corridor Volumes (USD)
The top ten host country destinations of emigrants for each respective African country
were identified using the World Bank Factbook 2011 and the World Bank’s T4 sources by
Dillip Ratha.
Using national statistics data the proportion of migrants from each country as a proportion
of the total immigrants from that country were calculated.
This proportion was then applied to the World Bank’s Factbook 2011 data for total
remittance inflows for each African country to provide an estimated value for each corridor
RSP Market Share
To estimate the RSP market share of operators and their services a number of industry
trends and sources directed our estimations.
These include:
The level of competition in a corridor and what impact that has on the dominance
of market leaders.
The level of coverage or accessibility an RSP and/or its services is able to offer in

DMA Consultancy Services
Our Consultancy Business

Remittances and Payments
– Private Sector: Market Entry, Diaspora Engagement and Seed
– Public Sector: Remittances Pricing, policy development

Financial Access and Inclusion
– Financial literacy programs
– Product Development

Regulation and Compliance
– Experts in PSD, EMI
– Advise governments in safeguarding
public funds without stifling competition

DMA Consultancy Services
Head Office
Developing Markets Associates
150 Tooley Street


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