Africa.com | A combination of rapidly evolving technology and the restrictions imposed by the COVID -19 pandemic has resulted in what is nothing short of a revolution in the online money transfer sector in Cameroon.
Globally, there have been drastic shifts in how people pay for goods and services, with electronic payments increasingly displacing traditional cash and more recently, cryptocurrency and digital currencies emerging in the market 1.
As of 2020, internet penetration in Cameroon was at 30% from less than 10% back in 2007, following the great strides from state and telecom operators who have ensured Cameroonians have good access internet services 2.
With the increased adoption of internet services and mobile phones throughout Cameroon, there has been a dramatic growth in mobile money, which allows an easy way to transfer money both domestically and internationally. 2.
This has caused a significant shift in consumer behavior when it comes to how people interact with financial services, with users taking advantage of rapidly evolving technologies such as mobile wallets and contactless cards to make payments and move their money around the globe. As of 2020, 65% (19.5 million) of the Cameroonian population had active mobile wallets and 26.5 million were using mobile money services 3.
According to the World Bank, mobile money accounts drove a massive increase in financial inclusion in Sub – Saharan Africa, as two–thirds of adults worldwide now send or receive digital payments, with the share in developing economies increasing from 35% in 2014 to 57% in 20214.
For many in Western society, the acceleration in technology makes for an easier and more convenient experience when dealing with digital remittances. However, for those citizens of emerging countries, the innovation and growth surrounding the global payments sector result in a wide range of benefits.
Digital remittances are a lifeline
In 2020, Cameroon received just over $334 million in personal remittances which sheltered many families from the challenging economic situation that COVID-19 brought. According to government data during this period, it was approximated that one in five Cameroonians live abroad and could regularly send money to their families back home for daily upkeep, education, and development 5.
It is without a doubt that remittances play a vital role in the country’s economy. Hence, an adequate system is needed to make sending money abroad a secure and simple procedure.
Banking for the unbanked
Until recently, migrant communities faced several stressful challenges when sending money abroad. Long queues, unfamiliar paperwork, and sky-high fees were typical hurdles at the beginning of a transfer that could take weeks to process. Once the money had finally reached its destination, the recipients needed access to banks or shops to collect their cash.
Today, with digital payment services like WorldRemit, people can receive money in a matter of minutes through bank transfers, airtime top-up, cash pick up and transfers to their mobile wallets.
These options that allow people to choose how to receive their money are vital in countries like Cameroon, where only 35% of the adult population had bank accounts as of 2017. This is due to insufficient proximity to financial institutions and the lack of education and digital skills of the least educated segments of the Cameroonian population 6.
Fortunately, this choice is facilitated by a boom in cheap and widely available smartphones that allow consumers and small enterprises to seamlessly transfer money at the touch of a button. Aided by FinTech vision and investment, Africa has been transformed into a world leader in mobile money. Again, the economic upshift facilitated by the new technology has contributed to a drop in the number of households living in poverty.
A safe and convenient service
Digital payments service, WorldRemit uses industry-leading technology to enhance protection for online money transfers. This technology is also swift, meaning that most transfers are ready within minutes.
The increase in secure digital remittances, especially mobile-to-mobile transfers, has lowered the need for cash transactions. Consequently, opportunistic crime in many cash-heavy markets has been reduced, however cyber-crime remains a very present threat, which money transfer companies must work hard to combat.
Moving forward together
The transition to digital payments and online money transfers has positively impacted migrant communities and emerging countries. This transition has made the process of sending remittances easier and more secure. It has also lowered the barriers for financial inclusion in emerging countries like Cameroon by allowing people without bank accounts to receive money quickly.
By offering flexible ways of sending and receiving money, more people worldwide can access financial services and ultimately free themselves from the manacles of poverty.
Find out how WorldRemit can help you move your money around with online digital payments.
Distributed by African Media Agency (AMA) on behalf of WorldRemit
Notes to Editors
1. Chambers and partners. Fintech 2022. March 2022
2. Journal du Cameroun. Online monetary transactions boost tertiary sector. October 2022
3. Techcabal. Cameroon risks stunting mobile money growth with new transaction levy. January 2022 World Bank Group. Covid – 19 Drives Global Surge in use of Digital Payments. June 2022
4. World Bank Group. Covid – 19 Drives Global Surge in use of Digital Payments. June 2022
5. All Africa. Cameroon:WorldRemit’s Fintech Is Transforming Lives in Cameroon. September 2022
6. UNCDF. Cameroon: Next steps in a high – potential market for Digital Financial Services.