Equity Group #ticker:EQTY grew the volume of diaspora remittances it processed by 87 percent in the first quarter of the year compared to the corresponding period in 2020, leveraging on the growing popularity of digital channels for sending money home from abroad.
The lender disclosed Wednesday that it handled Sh82 billion in remittances in the three months to March, up from Sh44 billion in the first quarter of last year.
The bank’s chief executive James Mwangi attributed this to linkage with multiple digital platforms, which have helped widen the geographical reach in the remittances segment.
Equity partners with more than 10 money transfer platforms, including Western Union, PayPal, WorldRemit, MoneyGram and hellopaisa, in addition to its own Equity Direct platform.
“Using fintech capabilities has given us a global presence, and as a result we have become a major processor of remittances payments around the world including across currencies, reflecting on forex trading across the region,” said Mr Mwangi in a briefing yesterday to announce the lender’s first quarter financial results.
As a result, the amount in commissions earned by the bank for handling remittances more than doubled from Sh200 million in the first quarter of last year to Sh500 million this year, which now accounts for a quarter of the lender’s total forex trading income.
In Kenya, diaspora inflows have in recent years overtaken agriculture and tourism inflows to become the leading source of foreign exchange for the country.
Central Bank of Kenya (CBK) data shows that in the first quarter of this year, Kenyans living abroad sent home a total of Sh89.4 billion ($829.4 million), with the bulk of it ($509.5 million/Sh54.9 billion) coming from North America.
CBK governor Patrick Njoroge has in past briefings attributed the continued rise in remittances to the adoption of digital channels by banks, which make it easier for people abroad to send money home—directly into the accounts or mobile wallets of recipients.