A new agreement between two global financial companies has the potential to bring important banking services to populations with limited access to traditional financial accounts.
The recently announced partnership of Vodafone and MoneyGram (News - Alert) will enable consumers to transfer funds directly from approximately 200 countries to the millions of users of M-Pesa, a service offered by Vodafone that allows customers to pay bills and withdraw, transfer and deposit money.
M-Pesa serves customers in low-income, rural areas who rely on cross-border transfers. The emergence of mobile money transfer services has grown in these regions because they offer a simplified solution for family members in other countries to send funds back to relatives.
The agreement between Vodafone (News - Alert) and MoneyGram will allow MoneyGram agents to send funds directly to M-Pesa accounts. MoneyGram customers can also transfer money to an M-Pesa user through moneygram.com or via a mobile app, available on iPhone, Android (News - Alert) and Windows 8 phones.
“There is huge demand for sending funds back to family and friends in your home market and an estimated $90 billion per year is transferred to M-Pesa markets from around the globe,” said Michael Joseph, Vodafone director of M-Pesa. “Our partnership with MoneyGram provides the most extensive global network and greatest number of access points for consumers wishing to transfer funds to M-Pesa users.”
The companies estimate that the service will be launched in key markets during the second quarter of 2014, with additional roll-out planned throughout the remainder of the year.
M-Pesa is currently available in the Democratic Republic of Congo, Egypt, Fiji, India, Kenya, Lesotho, Mozambique, South Africa and Tanzania—all countries with limited access to traditional banking services. Vodafone reported that the company also plans to expand M-Pesa in other underserved countries.
M-Pesa reportedly had nearly 16 million active customers as of September 30, 2013, and approximately 165,000 authorized agents worldwide. Active customers make in excess of €900 million worth of transactions per month.
MoneyGram offers money transfer services worldwide through a global network of 334,000 agent locations – including retailers, international post offices and financial institutions – in 200 countries and territories. MoneyGram also offers bill payment services in the United States and Canada.
Edited by Cassandra Tucker
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