Xoom, PayPal’s money transfer service, has announced the launch of its money transfer services to mobile wallets in 12 countries in Africa.
Xoom users in the US, UK, Canada and Europe will be able to do money transfers directly to mobile wallets in Burundi, Cameroon, Ghana, Kenya, Madagascar, Malawi, Mozambique, Rwanda, Tanzania, Uganda, Zambia, and Zimbabwe. Xoom plans to add more markets in 2021.
“Sending money to Africa through traditional channels has always been expensive. We wanted to help bring down the cost and speed up the process to boost financial inclusion,” said Julian King, Vice President and General Manager, Xoom. “There is nowhere else in the world that moves more money on mobile phones than Sub-Saharan Africa. While there are only five bank branches per 100,000 people as of 2019, there are 1.04 billion registered mobile money accounts in Sub-Saharan Africa3.”
With over one billion registered mobile money accounts, mobile money services are being deployed rapidly across emerging markets as a key tool to further the goal of financial inclusion—instrumental in lifting the undeserved population out of poverty and for driving economic growth.
Countries like Kenya, Ghana and Zimbabwe have over 60 percent of their adult population using mobile money accounts, Xoom will enable money transfers for cash pick-up, direct banks deposits and mobile reloads to 41 countries in Africa.
According to the World Bank, the cost of sending money through traditional channels to Africa is one of the most expensive in the world, with an average cost of 9.3 percent. The cost of sending $200 to the Sub-Saharan African region averaged 9 percent in 2018 and in the southern African subregion, the average cost was 18.7 percent, almost three times higher than the global average. Xoom wants to bring the costs down to just 2-4% of the transaction.
Xoom allows users to send money, pay bills and reload phones for loved ones in over 160 countries globally where remittances are used by the recipients to pay for school fees, utility bills, healthcare, emergencies among others.
Xoom also aims to end the cash-based system of sending money to Africa via traditional channels which is expensive, full of paperwork, uncertain, unreliable and slow. Xoom is available on Android, iOS or on the web at Xoom.com.