Nala, a Tanzanian fintech company, has expanded its services into the European market. This expansion will allow the fintech to operate in 19 European countries and enable remittances from them to African countries.
Despite the international remittance market being over-saturated with players, including traditional financial institutions and other fintechs, the process of sending money to African countries is cumbersome and challenging.
According to World Bank data, the average cost of sending money to African countries from European countries like Italy, France, and Germany hovers between 3% and 7% and could take up to 2 days depending on the platform.
Remittances are a significant contributor to the GDP of African countries. In Kenya, remittances contribute up to 3 percent of GDP, while in Nigeria and Egypt, that figure climbs up to 6% and 6.7%, respectively.
This demand has led to an increase in the total value of remittances to Africa despite the global economic downturn. According to the World Bank, remittances to sub-Saharan Africa have increased by 5.2% in 2022.
Speaking on the reason behind the expansion, he added, “The European economy is the third largest in the world and home to more than a quarter of African migrants. At NALA, our mission is to financially empower Africans across the world.”
On how NALA separates itself from the pack, Benjamin Fernandes, the founder and CEO of NALA, said, “Remittance companies have traditionally leaned on market expansion as a primary growth lever, causing them to pursue wider geographic reach rather than an added value to their product. At NALA, we are laser-focused on building the remittance company that Africans deserve.”
Over 11 million African migrants live in Europe, meaning NALA’s expansion has the potential for significant impact by providing more options to send money from Europe to Africa.
This expansion follows several other additions to NALA’s product, as the fintech recently integrated ApplePay and Google Pay into its offerings to allow payments from the US and UK to Africa.
NALA’s expansion follows in the footsteps of Nigerian Bluechip Technologies, after the software company expanded into Europe earlier this year.