18 Dec 2023
Did you know that the global proximity of mobile payment transaction users is projected to total 1.31 billion by 2023?
Over two billion people utilize mobile money internationally, and millions more people join the online money transfer service every year.
The younger generation has abandoned the traditional procedure of possessing a credit or debit card in favor of using mobile apps in India, Southeast Asia, and South America. But what are the gains and losses of leaving behind conventional bank transfers and cash payments? This article explores the benefits and risks of using mobile money for remittances.
Below are the benefits of using mobile money for sending remittances instead of conventional bank transfers.
The Sustainable Development Goal (SDG) 10c, which sets a target to cut the transaction fees of migrant remittances to less than 3% by 2030, is greatly impacted by mobile money.
Mobile money remittances have become the most economical way to send international remittances when compared with the other channels and instruments available, including cash. This aim was accomplished in the majority of the corridors well before the 2030 timetable.
The typical rate for sending $200 in international remittances via mobile money is 2.77 percent, compared to the global average of 6.09 percent for Q1, 2022, according to the World Bank's Remittance Price Worldwide report, which was published in June.
Mobile money providers are investing a lot of money to improve compliance with client due diligence, AML/CFT, and fraud prevention. This aims to increase the security of mobile money transactions and keep a heads up on the changing dangers.
Some mobile money service providers like ACE Money Transfer have gone above and beyond what is required by law to comply by putting into place a quality management process. Mobile money has also consequently improved last-mile resilience.
Mobile money service providers were at the forefront during the COVID-19 global epidemic when cash couriers and other money transfer channels were disrupted. It played a crucial role in digitally connecting overseas workers with their families back home, ensuring that the financial and economic lifelines remained active and accessible.
It gives you access to both a mobile application (app) and an internet account, enabling you to make transfers and keep a record of your payments at any time of day or night. Additionally, you can also set up monthly payments or make a one-time overseas money transfer.
These payments can be used for several things, such as paying off the mortgage on your holiday home, covering school costs, or regularly transferring money to family members who reside overseas.
You won't have to waste time manually transferring money from one country to another every time you need to move funds.
To send and receive money internationally, your bank needs to cooperate with a variety of intermediary banks. There is a chance that it could take a few days, possibly even a week or more.
It is feasible to request a quick money transfer online and have the funds appear in the recipient's account within minutes with the use of international money transfer services.
There is no perfect system for sending remittances. Therefore, the mobile money system comes with a few flaws as well, which are mentioned below.
The major risk associated with sending remittances through mobile money is the access to banking that money transfer companies receive. Unfortunately, the banks they're dealing with can decide to de-risk themselves from cooperating with money transfer services.
Operators run the risk of having their access to banking blocked within 24 hours at any given time. A money operator could expire in the flash of an eye, and your money might also simply vanish.
To ensure safety, it is vital to investigate the money transfer company you intend to use, read reviews, and confirm that they are dealing with reputable banks.
Utilizing reputable businesses that have been founded and active in the market for a long time saves you from monetary losses. ACE Money Transfer has been operating worldwide since 2002 and takes pride in its lengthy partnerships with several banks globally.
The procedure for sending money to family or friends by online money transfer is typically simple and easy. However, there is always a danger involved in disclosing your personal information and making it available on a platform.
You might be at risk of having your information exploited, in case, if your data is stored and a security breach occurs.
Numerous security precautions are taken when sending money online to guarantee the money is secure and prevent security difficulties, improving the appeal of this operation and system overall.
When you send money to someone you've never met before, the true issue arises. If you need to send money to a supplier you've never worked with, it can be difficult to confirm that the information provided by the individual making the request is accurate.
Fraud is a major problem when it comes to sending money online because anyone with a fake ID can get the transferred funds. However, reputable platforms can trace suspicious transactions and ensure no harm is done by using identity verification.
While the positives outshine the negatives when it comes to mobile money, you should always be aware of the firm that you choose. Good research and comparisons are essential when it comes to making the final decision.
ACE Money Transfer is one of the industry leaders in online remittance transfer services. It has been operating on a global network since 2002, with millions of returning users. ACE Money Transfer is reputable and safe. It has extremely strict AML and fraud policies that protect its users from getting scammed. Sign up on ACE to send money abroad at affordable rates with utmost security.
Mobile money offers convenience, speed, and accessibility for sending and receiving remittances. It allows users to transfer money securely from their mobile devices, often at lower fees than traditional methods. Additionally, it can reach recipients in remote areas without access to traditional banking services.
Some risks include the potential for fraud, technical issues, and the security of personal and financial information. Users should be cautious about phishing scams, and unauthorized access to mobile wallets, and ensure they use trusted mobile money providers.
Mobile money providers implement security measures such as PIN codes, two-factor authentication, and encryption to protect transactions. Users should follow recommended security practices, like regularly changing their PINs and not sharing sensitive information.
Yes, many mobile money services now offer international remittance options. Users can send money to recipients in different countries, but they should be aware of currency exchange rates, fees, and the availability of the service in both the sending and receiving countries.
Users should consider factors like the provider's reputation, coverage area, fees, exchange rates, and customer support. Reading reviews, comparing services, and understanding the terms and conditions of the mobile money service are essential steps in making an informed choice.
