Nigerian fintech company, Kuda Bank has perfected plans to expand into the United Kingdom market with a remittance service for Nigerians in the diaspora.
The service will enable Nigerians living in the UK to send money to Nigeria without paying a huge transaction fee.
According to the bank, it will compete in the remittance market with a flat fee of £3 and a transaction limit of £10,000.
Kuda however expects a significant portion of the remittance transaction on its platform to be between the range of £350 to £500.
Investors King understands that while remittance from Europe and America to Africa runs into billions of dollars every year, it is still largely difficult with high expensive transaction fees.
Diaspora Remittance to Nigeria is one of the largest in the world and the largest in Sub Sahara Africa. In July 2022, the Nigerians in Diaspora Commission (NIDCOM) stated that remittance from Nigerians in Diaspora has surpassed $20 billion.
The commission added that remittance has constituted a significant part of the country’s economy. The remittance market accounts for nearly 4 percent of Nigeria’s GDP as of 2020.
Going forward, Kuda bank stands to benefit from the huge remittance market as remittance from the UK to Nigeria is the second largest after remittance from the US to Nigeria.
Nonetheless, the bank will be competing with other notable players in the industry which include WorldRemit, Remitly, PayDay, and Lemonade Finance.
The bank however seems not perturbed as it banks on its users’ experience, convenience, and price factor.
“I don’t necessarily think it’s crowded because obviously, there are still a lot of challenges in remitting money to Africa, especially to Nigeria, which is still expensive.
“For us, it’s not just a remittance play. There’s a user experience, convenience, and price factor involved too,” said Chief Executive Officer Ogundeyi.
Meanwhile, Investors King understands that Kuda Bank has a registered presence in the UK already with the name Kuda EMI Limited. This will make it swift for the company to facilitate its UK-Nigeria remittance service.