First National Bank (FNB) has launched an instant money transfer service that will enable its customers in South Africa send money to neighbouring Zimbabwe , using their mobile devices.
Zimbabweans living in South Africa use formal and informal means to send money home. They either use money conversion service that converts Rand into Dollars or send an individual (who charge them for the service) to deliver cash to their recipients in Zimbabwe.
Recent research by the World Bank indicated that 20 percent of money sent to Zimbabwe from South Africa was spent on the cost of getting it there.
FNB also asserts in a statement that about 1.9 million Zimbabweans living and working in South Africa send an average R6.7-billion ($748 million) a year to Zimbabwe.
World Bank chart of remittance percentages figures that FNB, Nedbank and Standard Bank charged over 18 percent to send money to Zimbabwe, with Absa charging 15 percent, for online services. Western Union charged 8.7 percent for cash to cash. Bank of Athens charged 39 percent and Bidvest 32 percent. The total average charge for the first quarter of 2013 was 17 percent.
FNB is however offering an alternative which it said is a cheaper substitute to what is currently available in the market.
Speaking on the new offer, Head of Digital and Alternative Banking for FNB Africa, Yolande van Wyk, said, “FNB’s Zimbabwe Money Transfer service is more convenient and economical than anything else offered in the market.
She explained that FNB has “done extensive research into the cross-border remittance market and devised a service that is readily accessible to the people who need it most. People don’t always have the time to travel to the bank during working hours, and often need to send money home instantly and easily.”
“FNB Cellphone Banking allows senders to transfer South African Rand to Zimbabwe, instantly wherever they are. It is in line with the bank’s strategy to increase service options on our various digital channels,” added van Wyk.
The FNB Zimbabwe Money Transfer Service is based on a tiered pricing structure. Sending R1000 ($111) will cost R45 ($5), which is 4.5 percent of the value of the remittance. From R1001 ($112) to R1500 ($167), the fee is R70 ($8).
To use the service, senders from South Africa must be an FNB account holder who has complied with all the Financial Intelligence Centre Act (FICA) requirements (which prevents money laundering), and must be a permanent resident of South Africa. They must also be registered for Cellphone Banking.
Senders can send up to R1 500 ($167) a day, or R10 000 ($1,116) a month to Zimbabwe, Van Wyk said.
Once the money is withdrawn the sender will receive an SMS notification that it has been collected and if it is not collected within 14 days the money is reversed into the sender’s account.
While recipients can now collect their money at OK stores in Harare and Bulawayo; FNB plans to roll out to other outlets in Zimbabwe.
FNB does not have any branch in Zimbabwe.
