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6 clever tech startups trying to pop Africa’s remittance bubble

Remittance is a massive cash cow in Africa and the rest of the developing world. The service fees for transacting money from across the continent or abroad amounts to an estimated US$60-billion – a ridiculous amount that’s even said to outweigh Western aid in the continent. But the cost isn’t limited to taxing financial fees. The value of time and security also affects a massive portion of the developing world.

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Africans sending money home from abroad are charged an average of 12%, according to the World Bank.

Apart from traditional systems’ high costs, transferring money from point A to point B also takes time and is too often insecure. Meanwhile, US services like PayPal, MoneyGram and Western Union simply charge too much. As Ghanda’s bitcoin startup Kitiwa argues, companies based in the US have the ability to blacklist specific countries because of political reasons. This then disrupts businesses and consumers alike.

It’s little surprise then that there are many startups using tech trying to solve this issue (and possibly milk the cash cow). By leveraging technologies such as mobile phones, the internet and the popular digital currency bitcoin, startups are finding innovative solutions for unique problems.


Incorporated in Canada, Mergims plans to launch an online platform with which the diaspora can buy services online for friends and family in their home countries. By connecting immigrants with merchants on the continent, services such as tuition fees, airtime and utility bills can be taken care of abroad. The startup was named one of DEMO Africa’s top 40 startups of 2014.


Bitcoin has a host of disruptive potential and offers things like little to no transaction fees, security, frictionless transfers, and so on. Hailing from the UK and launched in 2013, Kipochi is one of those startups wanting to leverage bitcoin in order to help eliminate remittances.

The startup does so by introducing its own bitcoin wallet. The wallet can integrate with M-Pesa, meaning that people can easily convert bitcoin to and from their M-Pesa balances. Significantly, people using Kipochi can send and receive money to and from anyone in the world using their feature phones.


While not aiming to disrupt the remittance market directly, South African based bitcoin exchange BitX holds the tools necessary for low-cost money transfers. Launched by Switchless, the company has introduced an online wallet and has also brought bitcoin integration to 3 000 South African ecommerce stores with the recent partnership with South African based online payment company PayFast.


Launched a few months ago, Kitiwa is Ghana’s bitcoin distribution service that seeks to shake things up a little. Kitiwa wants to use bitcoin to enable people to send and receive money cheap and fast. The company was named one of Ghana’s top startups by Seedstars earlier this year and is also part of DEMO Africa’s top 40 for 2014.

(The Kitiwa website was offline at the time of writing.)


Powered by Redcore Interactive, Remit is a Ugandan based startup that offers real-time card to mobile money transfers from anywhere in the world to registered mobile money users based in Uganda. Targeting the Ugandan diaspora, the company claims to offer a more affordable, resilient, faster, safer, and more convenient way to transfer money to Africa.

Remit charges a transaction fee of 5.4%.


With Kenya as its main focus, BitPesa launched a beta test of its bitcoin money transfer service earlier this year. The site acts as a bitcoin to Kenyan Shilling currency exchange. People from abroad can send bitcoins to Kenyans which is then exchanged to shillings on their mobile wallets like M-Pesa, Orange, Airtel, or Yu.

BitPesa charges a three percent exchange fee.

Let us know which startup is your favorite, and if there are interesting ones we’ve left out.

Image by espensorvik via Flickr

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