The high cost of sending money to Africa

Many African migrants are based in Europe and they find themselves have to to pay alot of money just to get money to their families in Africa.Case in point would be African migrants sending to South Africa find that when they use money transfer organisations such MoneyGram or Western Union,they are being charged high fees in order to get the money to their families.

According to the World Bank, there are an estimated 120 million Africans depending on remittances from family members abroad for their survival,health and education,hence the World Bank argues that the high costs of remittance are cutting into the impact remittances can have on alleviating poverty levels.This just simply means that a person sending money from London,has to cut dowwn the amount that his dependants will reeive in South Africa because part of that money will will go towards paying the fees.

According to the Mail and Guardian (www.mg.co.za), the South African Reserve Bank and the treasury have committed to bringing the cost of remittances down to 5% by relaxing regulations for smaller money transfers, negotiating with regulators in the Southern African Development Community on exchange control regulations, and removing the requirement that MTOs partner with banks.

This is just an example of what other central banks of other countries could do to alleviate poeverty. Mukuru.com, an MTO that also remits from the UK to South Africa,has also entered the South African market.Their charges are very competitive,charging only 10% per transaction.