The growing economy is the result of the shining beacons of accomplishments and progress made by the expat population. There has been a steady economic growth in African nations due to the potential of our people. Many countries have foreign capital as the primary source of their income, and hence it contributes majorly to their GDP. The same goes for our developing African nations.
Let us discuss a few key details and also walk you through various aspects of inward remittance today.
Growth in the economy of Africa: Outlook 2020
The growth across the continent is expected to be moderate for the year 2020. Africa’s GDP in 2019 was about 2.9% and is further expected to scale up to 3.2%. The 2018 remittance stats show that by a total of 25 million expats from sub-Saharan Africa, a total of $46 billion have been remitted to the region.
Growth of inward remittance industry: Outlook 2020
For sub-Saharan Africa regions, foreign capital has majorly impacted the economic growth of its nations, as stated above. According to the Pew Research Center, nationals of sub-Saharan Africa are 8 out of 10 fastest-growing expat populations. This population has been the fuel for cross-border remittance flows.
2018 reports suggest that 25 million expats of sub-Saharan Africa remitted $46 billion to the African nations. In the coming years, the trend is expected to increase and will also have a significant impact on the GDP of these nations.
Trends affecting the future of inward remittance in 2020:
- Financial Institutions are behind the times: With more and more people wanting to move money across the borders, the banks are not able to keep up with their demands. With the rigidity of the bank regulations, they also do not want to incorporate the new ways in which remitting money from one country to the other can be made easy.
- Virtual money and hi-tech platforms: Mobile money and other international organizations have adopted new ways. They can cater to real-time cross border settlements and better manage foreign exchange. Mobile money or virtual money has hi-tech platforms that are capable of cutting costs, increasing transparency, and save time.
- Interoperability in financial services: The existing financial institution has a stringent framework that does not let them smoothly operate outside the boundaries. The availability of the bank branches, the intermediary costs of moving money between several branches, all hampers the interoperability of their financial services.
Only if you happen to have a digital wallet like EziPay that operates worldwide, remittance of money cross borders will never be a problem. Technology is modernizing the ways people send money across the borders.
- Future of Inward remittance: While the poor infrastructure of banks will just keep cashing out the customers. Remittance will just be another product in the trick. The future of remittances should be free, and nobody should be able to monetize through cross-border transfers.
The future of remittances calls for a low remittance cost for people to feel like they are not that far from the family, and the family receives a fair share of the amount transferred to them. Mobile money transferred through the EziPay application can help people to circumvent poor bank infrastructure and high remittance costs.