Banks costly channels for sending money - report

Kampala. Banks are the costliest channel for sending money from abroad, according to a new report.
The Global Knowledge Partnership on Migration and Development brief report places banks at an average cost of 10.9 per cent in quarter one of 2019 while post offices came second at 7.6 per cent.

The high costs involved in money transfers along many remittance corridors, particularly for poor workers who lack adequate access to banking services, reduce the benefits of migration, for poor households in origin countries.

The report which was released during the just-ended World Bank and International Monetary in Washington DC over the weekend, further states that remittance fees tend to include a premium where national post offices have an exclusive partnership with a money transfer operator. This premium was on average 1.5 per cent worldwide and as high as 4 per cent in some countries in the last quarter of 2018.
Remittances to Uganda – one of the recipients – were estimated at about $1.2 billion, in 2018 up from$1.1 billion in 2017.

Migration and Development Brief reports is an update on migration and remittance flows as well as salient policy developments in the area of international migration and development.
The brief report indicates that the cost of sending $200 to the Sub-Saharan African region where Uganda falls averaged 9 per cent in 2018 quarter four, almost the same as in 2018 quarter three.

Partnerships
Partner to cut costs: The brief report recommends that opening up national post offices, national banks, and telecommunications companies to partnerships with other money transfer organisations could remove entry barriers and increase competition in remittance markets.

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