Airtel joins international money transfer business

JULIUS BUSINGE

The new service was launched on Nov.14 at Kampala Serena Hotel. It will enable users of Airtel money to send and receive money from their loved ones living in another country.

The new service is being offered in partnership with Stanbic bank as partnering financial institution and has been endorsed by Bank of Uganda.

Its launch means that competition in the international money transfer service is growing and should translate into lower costs and efficient service enjoyed by customers.

Officials said that the new service will ease the remittance of money by its customers at home and across the globe.

With this new service, the company’s customers will conveniently, safely and instantly send funds across borders to Tanzania and Malawi from the Airtel money wallets at the most competitive rates and receive money from across the globe into their Airtel money wallets from of charge. More countries will be added on the platform.

V.G Somasekhar, the company’s managing director said that the service will drive financial inclusion while deepening social networks among friends and family.

“We are launching what not Airtel needs but what Ugandans need,” he said. He said that the service will be supported by the company’s infrastructure of 650 Airtel money branches spread across the country.

He said that the service conforms to the global anti – money laundering policies enhancing international trade, regional integration.

“Uganda is a growing economy that requires simplified ways of doing business at convenient and affordable rates,” Somasekhar said. He added that the international money transfer service will complement e-commerce that the company has facilitated through its data offerings.

In terms of user charges, Somasekhar said, customers will not be charged nor taxed for receiving money regardless of where the money is coming from. Charges would only apply at the point of withdrawal reflecting the recent 79% reduction in airtel money cash withdrawal.

Customers sending money will be charged against a tiered tariff at competitive rates across the market ranging between Shs900 – Shs58, 000.

Forex exchange rates will be determined by the prevailing market tariffs.

The addition of this new service makes the company as a one stop centre for offering voice, data, mobile money, and now cash transactions.

The State Minister for Foreign Affairs, Henry Okello Oryem said the service will deepen financial inclusion in Uganda but also boost regional integration agenda.

He said that inbound remittances to Sub-saharan Africa grew nearly 10% to reach $46billion in 2018 as per the World Bank estimates and, as the primary source of external financing in the region, it is critical for the social economic development.

With the average cost of 9.4%, Sub-Saharan Africa ranks amongst the most expensive remittance corridors globally.

The introduction of this service by Airtel shows that Airtel Uganda is driving financial inclusion and supporting the UN Sustainable Development Goals by reducing the cost of remittances.

Oryem added that the National Payments Systems Bill that is soon to be tabled in Parliament will further guide on how electronic transactions are made, but most importantly protect the interests of all key players.

He said that a service of this nature will contribute more to increased remittances to Uganda, which will feed into growth in GDP and foreign exchange reserves.

“These are interesting inventions of our time,” he said.   He added that such a service is key to encouraging people to get off the cash system and join the electronic platform which is very efficient, fast, convenient and safe.

Globally, according to data from Bank of Uganda, the global Ugandan diaspora contributed approx.Shs4 trillion) to the country’s economy in 2017 and the figure is estimated to have increased in 2018.

Airtel is the second largest telecom company in Uganda with slightly over 10 million subscribers. The largest number of this is registered for Airtel money service.

SOURCE: THE INDEPENDENT