E-Financial
Remittance Inflows to Nigeria Declines by 28% in 2020 ― World Bank
The World Bank says remittance inflows to Nigeria declined by 28 per cent in 2020 because of COVID-19 pandemic. The Bank also said remittance flows fell for Sub-Saharan Africa by 12.5 per cent, according to its Migration and Development Brief 33 Phase 11 entitled: “COVID-19 Crisis Through a Migration Lens’’ published on Thursday.
The report said the decline in remittance flows to Nigeria was largely responsible for the fall in remittance flows to Sub-Saharan Africa.
“The decline in flows to Sub-Saharan Africa was almost entirely due to a 28 per cent decline in remittance flows to Nigeria. “Excluding flows to Nigeria, remittances to Sub-Saharan Africa increased by 2.3 per cent, demonstrating resilience,’’ the report stated.
According to the report, the relatively strong performance of remittance flows during the COVID-19 crisis has also highlighted the importance of timely availability of data.
It stated that given its growing significance as a source of external financing for low- and middle-income countries, there was need for better collection of data on remittances. It emphasised that there was need for better collection of data on remittances, in terms of frequency, timely reporting, and granularity by corridor and channel.
The report quoted Dilip Ratha, lead author of the report on migration and remittances, as saying “the resilience of remittance flows is remarkable. Remittances are helping to meet families’ increased need for livelihood support. “They can no longer be treated as small change.
“The World Bank has been monitoring migration and remittance flows for nearly two decades, and we are working with governments and partners to produce timely data and make remittance flows even more productive.”
With global growth expected to rebound further in 2021 and 2022, however, remittance flows to low- and middle- income countries are expected to increase by 2.6 per cent to 553 billion dollars in 2021 and by 2.2 per cent to 565 billion dollars in 2022.
The report stated that global average cost of sending 200 dollars remained high at 6.5 per cent in the fourth quarter of 2020, more than double the Sustainable Development Goal target of three per cent.
It stated that Sub-Saharan Africa continued to have the highest average cost (8.2 per cent) adding, supporting the remittance infrastructure and keeping remittances flowing includes efforts to lower fees. In addition, it stated that the decline in recorded remittance flows in 2020 was smaller than the one during the 2009 global financial crisis (4.8 per cent).
It was also far lower than the fall in Foreign Direct Investment (FDI) flows to low- and middle-income countries, which, excluding flows to China fell by over 30 per cent in 2020. As a result, remittance flows to low- and middle-income countries surpassed the sum of FDI (259 dollars billion) and overseas development assistance (179 dollars billion) in 2020.
The main drivers for the steady flow included fiscal stimulus that resulted in better-than-expected economic conditions in host countries, a shift in flows from cash to digital and from informal to formal channels, and cyclical movements in oil prices and currency exchange rates.
The true size of remittances, which includes formal and informal flows, is believed to be larger than officially reported data, though the extent of the impact of COVID-19 on informal flows is unclear.
“As COVID-19 still devastates families around the world, remittances continue to provide a critical lifeline for the poor and vulnerable,” said Michal Rutkowski, Global Director of the Social Protection and Jobs Global Practice at the World Bank.
“Supportive policy responses, together with national social protection systems, should continue to be inclusive of all communities, including migrants.” In addition, it stated that the relatively strong performance of remittance flows during the COVID-19 crisis had also highlighted the importance of timely availability of data.
“Given its growing significance as a source of external financing for low- and middle-income countries, there is a need for better collection of data on remittances, in terms of frequency, timely reporting, and granularity by corridor and channel’’.
The World Bank is assisting member states in monitoring the flow of remittances through various channels, the costs and convenience of sending money, and regulations to protect financial integrity that affect remittance flows. It is working with the G20 countries and the global community to reduce remittance costs and improve financial inclusion for the poor.
Nigerian banks have resumed international transactions on naira-denominated debit cards, marking a significant shift in banking operations for customers who rely on foreign payments.
This is coming nearly three years of suspension.
United Bank for Africa (UBA) and Wema Bank, in separate communications to their customers, announced the restoration of international payment services on their naira cards.
In a notice to its customers, UBA said the reactivation of international transactions on its premium naira cards aligns with its commitment to delivering improved and seamless banking experiences.
“We are pleased to inform you that all UBA Premium Naira Cards, including Gold, Platinum, and World variants, are now enabled for international transactions,” the bank stated.
“This means you can now use your Premium Naira Card for global payments — including online shopping, POS, and ATM transactions — with ease and flexibility. If you haven’t used your card recently, now is a great time to rediscover the convenience and prestige that comes with being a UBA premium cardholder.”
Similarly, Wema Bank announced that its customers can now make dollar payments on international platforms using their naira Mastercards.
“Your Wema Naira Mastercard just went global!” the bank said. “Now you can pay in dollars on all your favourite international platforms — Amazon, eBay, AliExpress, Netflix, Spotify, YouTube.”
The development marks a major relief for Nigerian customers who have had to rely on dollar cards or alternative payment methods since most banks suspended international usage of naira cards in 2021 due to foreign exchange scarcity.
Flutterwave, Africa’s leading payments technology company, today announced the relaunch of its flagship remittance solution, Send App, across U.S. states following its newly acquired Money Transmitter Licences (MTLs).
This comes after Flutterwave secured 20 additional MTLs in the U.S., adding to the 14 licenses the brand has held since 2023.
Altogether, this achievement raises Flutterwave’s total number of direct licenses to 34, allowing the company to operate across many U.S. states and territories without partners or intermediaries.
Users in the U.S. can now send money to Nigeria, Ghana and Egypt, unlocking new remittance corridors that were previously unavailable.
Alongside this expansion, the onboarding process has been streamlined with a quick ID check, making it faster and easier for new users to get started.
Additional improvements include optimised payment support for US-issued Visa and Discover cards, enhanced security measures to safeguard transactions and maintain compliance, and improved in-app flows for a simpler, more efficient sending experience.
This return also highlights Flutterwave’s commitment to delivering a seamless, secure, and regulatory-compliant user experience for all Send App customers in the U.S. Users can now send money from DC, Georgia, Maryland, North Carolina, Michigan, South Carolina, Tennessee.
Other U.S. states and territories where Send App by Flutterwave supports outward remittances include Alaska, Arizona, Arkansas, Delaware, Idaho, Illinois, Indiana, Iowa, Louisiana, Maine, Minnesota, Mississippi, and Missouri, Nebraska, New Hampshire, New Mexico, North Dakota, Oklahoma, Oregon, Puerto Rico, Rhode Island, South Dakota, Utah, Washington, West Virginia, Wisconsin, and Wyoming.
Commenting on the relaunch, Olugbenga “GB” Agboola, Flutterwave Founder and CEO, said, “By expanding our reach and enhancing our services, we are empowering millions of Africans in the U.S. to maintain strong financial ties with their home countries, support their families, and contribute to economic development across the continent. Additionally, we are staying true to our core mission of bridging Africa with the global economy and vice versa.”
Earlier this year, Flutterwave integrated Swap into Send App for seamless FX transactions and strengthened its services in Ghana by securing approval for inward remittance from the Bank of Ghana.
Federal High Court in Abuja on Friday affirmed the authority of the Nigeria Inter-Bank Settlement System (NIBSS), to manage the Bank Verification Number (BVN), database across the country, in line with the Central Bank of Nigeria (CBN), Act and other relevant banking laws.
This is according to a judgment delivered by Justice James Omotosho on Friday.
Wolemi Esan, senior advocate of Nigeria, NIBSS’s counsel, and Kofo Abdulsalam-Alada, lead counsel for the CBN, among others, had sought a restraining order to prevent any institution in Nigeria from challenging the agency’s statutory authority to maintain and manage the BVN database.
This comes as NIBSS had alleged that Digital Rights Lawyers Initiative filed multiple suits, either directly or through proxies, challenging its authority to manage the BVN database and claiming that such management violates constitutional privacy rights.
However, Justice Omotosho, delivering his judgment, said the BVN does not infringe on the constitutional right to privacy.
“The initiative does not infringe on the constitutional right to privacy but rather serves as a necessary tool for safeguarding public interest and enhancing financial security.
“NIBSS has the power to manage the BVN,” the judge said, citing relevant CBN laws.
“The court grants the reliefs of NIBSS as prayed,” he stated.
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