How long has WorldRemit been in operation?
WorldRemit sent its first money transfer in 2010. I came up with the idea for a fully digital money transfer service when I was working for the United Nations East Africa Remittance Programme which was set up in the wake of 9/11 to find a secure and compliant way to send money to the Horn of Africa. My vision was for a convenient and fully digital service that would be a better experience for remittance senders and recipients while solving the compliance challenges of the industry.
What did you aim to solve with this line of business?
To send money home, most people in diaspora visit physical money transfer agents, taking time out of their busy lives and paying often extortionate fees in the bargain. With the WorldRemit app and website, our customers can make quick, secure money transfers, 24/7. We also want to give receivers of money transfers the widest range of options to collect their remittances.
How much volumes of money have gone through the service?
We’re a high volume business – our customers now send well over half a million money transfers every month. We send 25,000 transfers to Uganda alone every month.
According to the statistics how much remittance comes to Africa, specifically Uganda?
The World Bank estimates that Uganda received $1.049bn in remittances in 2015 – around 4% of GDP – however the actual total is likely to be significantly higher than that. Millions of Ugandans rely on money sent by family and friends living abroad, it’s an incredibly important lifeline.
Remittances to sub-Saharan Africa in total are estimated at around $36bn.
Uganda currently has over 22 million people using mobile money, 19 million owning handsets, has this contributed to increase in money remittances to Uganda?
Uganda is one of the leading countries in the world for mobile money and consequently is leading the way in mobile money remittances too. The majority of WorldRemit money transfers to Uganda are received on MTN Mobile Money accounts. Instead of travelling long distances to foreign exchange bureaus which can be expensive and even dangerous in some areas, many of our customers are now choosing to instantly and securely receive remittances direct on their phones.
What’s more, we see an important correlation between mobile money and ‘micro-remittances’. When our customers send to mobile money, they tend to send smaller amounts, more frequently. Remittances are becoming more casual and on-demand. Rather than waiting for their fortnightly or monthly paycheque before sending a lump sum to family members overseas, the diaspora are now communicating every day with their family on WhatsApp or Viber and sending small sums as and when they’re needed.
What future do mobile phones play in digital finance today?
Already for millions of people around the world, mobile phones are the only means of accessing financial services. In many countries across the developing world – including Uganda – the majority of the population do not have bank accounts and are not likely to gain access in the future. However, most people do have access to phones. These conditions lay the foundations for mobile money to be successful.
In many ways, Uganda has leapfrogged the “developed” world when it comes to financial services. Most Ugandans can make instant payments with a few taps on their phones unlike their counterparts in countries like the US or the UK!
What challenges do you face in operating this business?
One of major challenges is convincing the diaspora that sending money online is safe and secure. Out of habit, many migrants still prefer to send money at bricks-and-mortar money transfer agents. It’s our job to convince people that sending a remittance via an app or website can in fact be far more secure than sending a remittance in cash at a money transfer agent.
What is your take on bitcoin?
We’re closely following the development of cryptocurrencies like Bitcoin and the underlying blockchain technology. However, at present we don’t see Bitcoin as a viable alternative to fiat currency remittances. A big challenge in remittances is getting money to difficult-to-reach places which lack established financial infrastructure. Bitcoin can’t solve those challenges.
Do you think there’s future for a cashless economy? Why?
Countries like Uganda are already well on their way to becoming cashless!
While I live in the UK now, I was born and raised in Somaliland. Somaliland has an extremely successful mobile money service called Zaad. When I was last in Somaliland, I didn’t have to touch cash while I was there because Zaad is so widespread and popular.