Remittance fees hurt Africans, says Comic Relief

[Bit_Happy]

Communities in sub-Saharan Africa are being "hurt" by high fees charged by money transfer operators, charity Comic Relief has said.

Restricted competition has helped push up charges, according to research by the Overseas Development Institute (ODI).

Money transfer company Western Union said that fees were set according to factors such as local taxes.

The company "delivered much-needed services to individuals", it added.
'Duopoly'

The research found that average fees of 12% to send $200 (£119) were twice the global average.

Siddo Deva of Comic Relief said: "Imposing such high remittance fees from hard-earned income is hurting the African diaspora and, more importantly, their families and communities in the countries of origin."

Fees charged to Africans wishing to send money back amount to a "super-tax" that could be better spent on education or health, ODI said.

"Africans living abroad make huge sacrifices to support their families, yet face charges which are indefensible in an age of mobile banking and internet transfers," said Kevin Watkins, the report's co-author and ODI Director.
http://www.bbc.com/news/business-27046285

12% is way too high!
Sounds like a great chance to teach them about BTC.

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[counter]

Great find!  Stories like this are an excellent way to get a better idea of areas and groups of people that need to be attracted to Bitcoin for lack of a better term.  +1 Bit_Happy

[zimmah]

Ye, i wonder how long it will take for bitcoin to catch on there and put moneygram and amex out of their game.

12% fees is just theft, the poorest people in the world are often robbed the most.

[bryant.coleman]

Yes. 12% fee is outright robbery. That said, I have paid 10-12% for most of my money transfers using Western Union in the past. Add the currency exchange charges as well, and you will find this intolerable.

But I am glad that M-Pesa / Kipochi is helping a lot of Africans to escape this exploitative setup.

[Bit_Happy]

Great find!  Stories like this are an excellent way to get a better idea of areas and groups of people that need to be attracted to Bitcoin for lack of a better term.  +1 Bit_Happy

Thanks counter 

Yes. 12% fee is outright robbery. That said, I have paid 10-12% for most of my money transfers using Western Union in the past. Add the currency exchange charges as well, and you will find this intolerable.

But I am glad that M-Pesa / Kipochi is helping a lot of Africans to escape this exploitative setup.

I've also used Western Union in the past, but it's been over 12 years, thank goodness.
BTC will make major progress in these areas, especially when people have even more places to spend/convert it.

[bryant.coleman]

I've also used Western Union in the past, but it's been over 12 years, thank goodness.
BTC will make major progress in these areas, especially when people have even more places to spend/convert it.

Unfortunately, I am still forced to use WU, although less frequently when compared to the past. Sending small (international) payments are such a headache with WU. There have been times when I paid more than 100% in fees.

[yayayo]

Despite the high fees the service is still used. The reason is simple: Lack of competition.

But in order that bitcoin can help with this issue, bitcoin companies must provide a practical, low-tech method for handling the funds in the receiving country. In person or simple mobile sms-service would be the method of choice.

Kipochi at this stage is simply not suitable for the mass market, because it requires a smartphone with internet access.

ya.ya.yo!