Average cost of sending $200 was 2.7 percent for making remittances via mobile money account as compared to 6 percent when using MTOs. Lower transaction fees can translate directly into additional income for remittance recipients.
Mobile money providers are strategically well-placed to lower international remittance costs by increasing competition, leveraging existing networks and infrastructure, and capturing smaller remittance values than traditional players, said a GSMA research.
These lower prices contribute directly toward achieving targets within United Nations Sustainable Development Goal (SDG) 102, which sets clear objectives for reducing migrant remittance costs.
There are more than 400 million registered mobile money accounts across over 90 countries. Today mobile money services are largely used for domestic transactions.
“In just a few years’ time, mobile money has moved from a purely domestic service to one that allows migrants to send remittances between more than 20 countries globally,” said John Giusti, chief regulatory officer, GSMA.
In 2015, global remittances totalled $581.6 billion, of which $431.6 billion, or nearly 75 percent, was sent to the developing world.