Absa aims to take a bigger share of Africa’s lucrative remittances market, announcing a new partnership with cross-border payments provider Thunes.
The movement of people and goods on the continent and the encouragement of greater trade in the region are creating the need for simpler, more affordable forms of payment.
Absa hopes to make its mark by offering customers lower fees and quicker settlement as rivals including FNB and Capitec have entered partnerships or created products to better compete in this segment.
On Thursday, the lender said it has signed an agreement with Thunes to start Absa Global Pay, a digital remittance service “that makes sending money across borders faster, simpler and more affordable for millions of customers across Africa”.
South Africa has a huge migrant community, particularly from neighbouring countries. Absa customers will be able to send funds directly from the Absa banking app or online banking with instant settlement to 18 countries.
The bank has earmarked six countries — the UK, Kenya, India, Malawi, Pakistan and Zimbabwe — for the initial release.
Customers can choose various payout methods — bank accounts, mobile wallets or approved cash pick‑up points — for settlement in the countries where the money is sent.
Connecting systems
Thunes has a similar partnership with MTN’s mobile money unit in Nigeria, and its payments network enables businesses and consumers to send, receive, and manage money instantly across 130 countries in 80 fiat currencies and stablecoins.
At its core, Singapore-based Thunes bridges fragmented financial ecosystems by connecting to 22-billion mobile wallets, bank accounts and cards.
That network includes companies such as Uber, Airbnb, M-Pesa, Visa, Mastercard, WeChat Pay and World Remit.
Absa, founded more than 100 years ago, has operations in 16 countries. It serves almost 13-million customers, mostly in South Africa.
“Remittances remain essential for keeping families supported across borders, and our research shows significant opportunity to unlock more value in this space,” said Nick Nkosi, Absa managing executive for transactional banking & services.
“With Thunes, we are delivering a solution that is simpler, faster and more affordable.”
The growth of competition in Africa’s financial services market has helped speed up the time it takes for payments to clear and reduce costs, with the likes of World Remit, Mukuru, MoneyGram, Nala, Chippa and mobile operators offering the service.
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