Stakeholders in the remittance market from
across Africa are in Cape Town, South Africa, to discuss how to leverage money
transfers through the postal network and make them more affordable and
accessible to rural people.
About 100 delegates from postal operators and
banks, regulatory authorities, governments, the private sector, international
organizations and civil society are attending the first African Conference on
Remittances and Postal Networks, a two-day event hosted by the International
Fund for Agricultural development (IFAD).
Each year, remittances worth more than 60
billion USD are sent to and within Africa, but often at great expense. The
conference is addressing the challenges for improving the provision of
remittance and financial services through postal networks in rural Africa. This
includes market positioning of postal operators, linking remittances with
financial inclusion, innovative technologies for financial inclusion and the
legal and institutional environment affecting post offices and remittances.
The UPU is convinced that the postal network
is key to reaching this goal. In recent years it has partnered with IFAD on
several projects in Africa, Central Asia and Asia-Pacific. “Together, we have
connected some 30,000 post offices in Africa, Asia and Central Asia to the
UPU’s electronic financial network, making it possible for millions of additional
people to send and receive digital payments through the post,” says M’Hamed El
Moussaoui, chairman of the UPU’s financial inclusion working group.
Development impact
According to an IFAD press release,
remittances make a major contribution to the incomes of rural households. “But,
at the same time, a dearth of services, lack of competition and other causes
also make rural remittances enormously expensive,” IFAD points out.
Similarly, it says, high transaction costs,
limited rural payment networks, low financial literacy and consumer protection,
as well as problematic regulatory environments prevent these financial flows
from having greater development impact.
According to UPU research, more than 80 per
cent of post offices in sub-Saharan Africa are located outside the top three
cities in each country, in areas where banks are often absent. Post offices are
often well placed to deliver remittances in rural areas.
The conference is organized under the African
Postal Financial Services Initiative. This unique joint regional programme was
launched by IFAD in collaboration with the World Bank, the Universal Postal
Union (UPU), the World Savings Banks Institute/European Savings Banks Group
(WSBI/ESBG) and the United Nations Capital Development Fund (UNCDF). It is
co-financed by the European Union.
