Senditoo, the international remittance service, has announced that it is cutting fees for people sending money back home. This cut means that customers who send money to Zimbabwe won’t be charged for the transaction.
Even though there were projections that the remittance market would take a decline at the start of the pandemic, the need to send money back home only increased. Senditoo saw a particularly large demand for their home delivery service which allows family or friends abroad to send money right to their recipient’s doorstep.
“Zimbabweans in the diaspora are a key part of our business and continue to drive its exponential growth. In the last five months, the demand for remittance services to Zimbabwe has increased, particularly our delivery service in Harare and Bulawayo. This new incentive
creates an opportunity for expansion and a service that customers – old and new – can rely on”
I am sure there are many among you who have received and sent money abroad. Until recently it wasn’t uncommon to see service charges that went all the way up to 10%. However, as more and more players came into the remittance space, service charges slowly began to plummet.
The players that played a part in the downturn of prices were the digital remittance companies. They were able to undercut the established players which drove down the fees. According to Senditoo even with the more players entering and offering better rates, it’s has proven difficult to switch customers over.
“There is clearly strong price competition in this space and we need to encourage technological innovation. Mobile money is transforming the financial sector in many countries and I believe emerging technologies will be influential in extending direct person-to-person, phone-to-phone money transfers across borders, lowering costs at the same time. We need to champion these innovations and this is one of our strategic steps,”Takwana Tyaranini, co-founder of Senditoo
With Senditoo removing fees it means that even more money will make it back home. The company’s other co-founder, Ibrahima Soumano said that removal of fees is also an effective way of keeping customers. He concluded by saying that more action is required at all levels in countries that are net sender and net recipients.