Remittance is very important to Africa where several economies rely greatly on money sent home by citizens in the diaspora. Nigeria is by far Africa’s largest remittance recipient receiving about $21 billion annually. Remittance is also the country’s second biggest source of foreign exchange earnings. In view of the importance of financial flows to Nigeria from migrant workers abroad, U.S.-based money transfer company MoneyGram has started offering its customers in France, Germany, Ireland, Italy and Spain a way to send money to most personal Nigerian Naira bank accounts within minutes.
“This is a significant milestone for us. With the addition of Nigeria, MoneyGram now offers bank account deposits through our network into five of the world’s largest remittance receive markets — Nigeria, China, India, Mexico and the Philippines,” says Herve Chomel, MoneyGram’s regional vice president for Africa. “Account deposit is a fast and secure way to send and receive funds between loved ones and we are proud to offer the service for our customers in Europe and Nigeria.”
Africa has for years been losing about $2 billion annually in remittance fees to the big players in the industry, until disruptors such as WorldRemit, offered Africans abroad alternative means of sending money home. MoneyGram’s 2014 fourth quarter revenue in its Global Funds Transfer segment fell 9.5 percent year over year to $330.6 million. Money transfer transaction volume also decreased by 2 percent and money transfer fee, as well as other revenues, declined 10.1 percent year over year to $305.7 million.With their revenues shrinking as a result of the activity of the disruptors in the industry, big players in the money transfer space are introducing innovative means of money transfer which is cheaper and more efficient.
Moneygram notes that it is the first money transfer company to offer straight to local bank deposit.
According to the money transfer company, customers can send money to most of the personal accounts held at banks that are members of the Nigeria Inter-Bank Settlement System (NIBSS) network including First Bank, UBA, Ecobank, Fidelity, and Zenith Bank from MoneyGram agent locations in France, Germany, Ireland, Italy and Spain.
By integrating into the Nigerian Inter-Bank Payment System, MoneyGram customers are able to send money into most bank accounts in Nigeria, almost in real time. Receivers do not have to undertake any action as the funds are automatically deposited into their account and can be accessed via ATM’s or online, without the constraint of a physical over-the-counter visit, a statement by Moneygram says.