WorldRemit creates a world of difference in remittances
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Sydney, Australia, December 20, 2017
Research from leading digital money transfer service WorldRemit shows that migrant workers in New Zealand sending money to family and friends overseas for Christmas may be paying up to $37.23 (USD $26.20) more of their hard-earned cash for each transfer of $284 (USD $200) sent via offline methods – enough to buy a spa day in Colombia.
Potential savings
Online players like WorldRemit are giving traditional operators and the banks a run for their money by driving the digitisation of international remittances – saving time and cash for migrants in New Zealand.
Through comparison research of the savings customers could receive by moving away from traditional channels, WorldRemit is demonstrating that the potential cost savings of online transfers this Christmas.
More than one million (25%) of New Zealand’s resident population was born overseas, according to latest census figures.
Each year, more than $1 billion is sent from New Zealand in remittances and the final week before Christmas is one of the busiest times to send money.
The World Bank reports that the average cost of sending money is around 7.21% meaning that it usually costs around about $14 to send $200.
WorldRemit New Zealand Head Bryce Currie said that in the week leading up to Christmas, a spike in remittances occurs to countries where people celebrate the holiday.
Expensive methods
“Therefore, we know this is an important factor for migrants in staying connected with their families at a special time of year while they are working abroad. About 90% of global remittances are still sent offline, via cash-based methods,” he said.
Mr Currie said that these methods are usually expensive and very time consuming, especially in an age where we have fast and cost effective online channels.
With the right provider, you could save up to $26.20 for every $200 you send; and that is either money in your pocket or an extra gift under the Christmas tree,” Mr Curriesaid.
Comparative costs and savings
The impact of the savings could be even more significant to those back home where $26.20 could equate to at least a day’s work in Colombia, for example.
WorldRemit data suggests that most of their customers in New Zealand send money home at least twice a month and hence the savings in December could be even greater. Doing so through traditional methods means taking at least a half-hour out of their day to travel to an agent to pay money.
Saving the cost of public transport in New Zealand to pay in money twice a month could be enough to buy a bottle of wine in Kenya or a bath hamper in Zimbabwe.
Mr Currie said that since New Zealand sends over $1 billion in remittances every year, the cost savings could be substantial if everyone sent their money transfers online.
“We can really make a difference in the lives of our customers and their families around the world.” Mr Currie said.
Savings examples
Sending from New Zealand to:
Colombia – $26.20 (enough to buy a spa day in Colombia)
Kenya – $22.7 (enough to buy a bottle of whisky in Kenya)
Ghana – $19.9 (enough to buy a box of chocolates in New Zealand)
Uganda – $17.6 (enough to buy a set of wine glasses and cookies for children)
Zimbabwe – $15.9 (enough to buy a pair of Haivianas flipflops)
Notes
The savings were calculated based on sending the local equivalent of US$ 200 using a weighted average of pay-in and pay-out methods for the leading traditional money transfer operator compared to WorldRemit.
About WorldRemit
WorldRemit was founded in 2010. Its Chief Executive Ismail Ahmed, a UK- based entrepreneur from Somaliland saw the opportunity to give customers a better service by offering faster, lower-cost and more secure digital money transfers compared to traditional ‘bricks and mortar’ agents.
The company has grown quickly and ranked in the ‘Sunday Times Tech Track Top 100 List of Fastest Growing Tech Companies for the past two years in a row.
Backed by Accel Partners and TCV – investors in Facebook, Spotify, Netflix and Slack. Dr Ahmed was recently voted the third most influential person in the 2018 Powerlist of 100 people, which recognises those of African and African Caribbean heritage. In 2017 WorldRemit was recognised by the FT and the IFC as the UK’s most Transformative Business in the Transformational Business Awards.
WorldRemit’s global headquarters are in London, with offices in the United States, Canada, South Africa, Singapore, the Philippines, Japan, Australia and New Zealand.
Useful links:
World Bank Remittance prices data
