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Tailoring Your Financial Strategy: The Role of Digital Money Transfers in Diversifying Remittances to the Gambia from the UK

25 Jan 2024


Do you know that digital remittances can reduce transaction costs and reach remote low-income households in a timely & effective way to send money to Gambia from UK? Gambia received remittances of 40.35 million US dollars from the UK in 2021. As a Gambian expat, tailoring your financial strategy in diversifying remittances is crucial for you and your family’s financial needs. It also represents the lifeline for countless Gambian homes. All financial institutions, including financial giants like the IMF and World Bank, are fostering technological innovations to grow financial stability and integrity. 
 

Digital money transfers have become the exclusive solution in the shaking up of domestic and cross-border remittances due to consumers’ preferences towards digitalization. Governments are also showing a tendency to use digital ways of financial solutions. That's why remittances significantly positively impact the country's economic growth. Read on to get valuable insights on the role of digital money transfers in diversifying remittances from the UK to the Gambia. 

Vital Impact of Remittances on the Economy of Gambia

Remittances are the extensively substantial ties between migration and the economic development of Gambia. In effect, remittances as external financing are the robust driving force for Foreign Direct Investment (FDI) and Overseas Development Assistance (ODA) in most Sub-Saharan African countries, including Gambia. So, remittances are a private financial resource for Gambian families from Gambian immigrants and act as an external financial resource for the economy. So, if you send money online to Gambia from UK, it directly moves forward the overall development of your country. 
 

Remittance inflows to the Gambia have consistently increased, nearly tripling in the last four years, rising from $278 billion in 2018 to $773 billion in 2021. Surprisingly, remittances accounted for 63% of the Gambia’s GDP in 2021. It has also made the Gambia one of the countries with the largest reliance on remittances globally.

The Role of Digital Money Transfers in Diversifying Remittances 

Digital innovations in the financial sector have created a significant role for digital money transfers in diversifying remittances compared to traditional lengthy procedures. Have a review of the prominent factors of this dynamic role of digital remittances: 

Expanded Source of Revenue

New developments in financial technology and the continued digitization of the remittance sector have the potential to increase the amount of money that migrants' families receive. This factor, in turn, could help alleviate poverty inequality and improve Gambian people’s access to banking services. If you want an instant money transfer to Gambia from the UK, the digital remittance service of ACE is incredible. Also, households in rural areas of Gambia that are particularly vulnerable stand to benefit the most.

Competitive Remittance Services

When compared internationally, the remittance services offered by traditional operators have been quite competitive after the digitization of remittances by digital money transfer services like ACE Money Transfers. According to financial experts, remittance fees could be even lower if there was more competition between digital and traditional money transfer services. You can benefit from these competitive remittance services while sending money to your home country, Gambia. 

Promoted Financial Inclusion

The beneficiaries of remittance opportunities in the financial technology sector are already visible worldwide. Like, the Gambian migrants send money to Gambia online from UK. So far, the industry's shift has been more cautious than revolutionary, with old and new players forming relationships that benefit both parties. Traditional services benefit from these agreements because they make their back-end procedures more efficient and transparent. At the same time, new operators gain access to customers who aren't very digital at a cost.

Decreased Remittance Fees

Another significant impact is decreased remittance fees, which is just one of the many ways fintech may help expand access to financial services. Disconnected from traditional channels like bank branches and agent networks, low-income households in rural areas might receive digital remittances. Now, not only are digital remittances quicker than traditional sources, but the data they carry can supplement more conventional banking tools for determining a customer's trustworthiness.

Enhanced Mobile Financial Services

Digital money transfers are the best way to send money to Gambia from the UK, increasing the usage of mobile financial services and establishing & strengthening partnerships between telecom and fintech companies. Digital remittances will most likely lead to expanded access to and development of financial services. The public and commercial sectors must collaborate to increase digital and financial literacy. 

In a Nutshell

Most of the countries in the world now rely significantly on remittances received from their migrants. So, in the context of tailoring your financial strategy for the best way to send money to Gambia from UK, the role of digital money transfers is crucial. Personal received remittances act as an incredible basis for foreign exchange and reduce the poverty level in developing countries like Gambia.
 

Millions of Gambian families, especially the most vulnerable, rely on remittances as a vital source of income. Although statistically, not much research has been done on the positive impact of remittances on the economic growth of Gambia, all other worldwide sources verify the strong positive influence of remittances on the economy of Gambia.

FAQs

Why is the digitalization of remittances an opportunity for financial and digital inclusion in Gambia? 

The IFAD research emphasizes the chances to capitalize on the potential of mobile remittances in the country, as mobile money services were recently reactivated. The country-specific analysis offers policy recommendations on how the Gambia may capitalize on mobile-enabled international remittances and connect remittance families' financial goals with the commercial initiatives of financial service providers.

How do I send money from the United Kingdom to Gambia?

The average cost of online money transfers from the United Kingdom to Gambia with Western Union* is 4.9% of the amount sent. In contrast, the ACE Money transfer has a reasonable option for money transfers to a cash pick-up location in Gambia with fast and reliable service benefits. 

What is the value of remittances sent from the United Kingdom from 2003 to 2022?

In total, the value of remittances sent from the UK from 2003 to 2022 was 10.8 billion US dollars. These personal remittances include personal transfers as well as employee compensation. So, there is robust potential for Gambian expats from the United Kingdom to support their country.

What is the most suitable currency for Gambia?

The Gambia's official currency is the Gambian dalasi (GMD). In 1971, the dalasi replaced the Gambian and West African pound at a conversion rate of 5:1. The Bank of Gambia issued the GMD, which is freely convertible against other international currencies. Therefore, exchange your pounds for Dalasi to ensure you obtain a fair rate. 

Is Gambia a high-income country?

Gambia is a Least Developed Country (LDC) with 'poor human development' (173 out of 188 countries). Despite significant gains in poverty reduction throughout the early 2000s, development has halted since 2010. The Gambia remains one of the world's poorest countries, with a per capita GNP of USD 440. That's why increased remittance opportunities are the backbone of the Gambian economy. 


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