Why Is It Convenient to Send Money to Nigeria from the UK?
By Space Coast Daily // July 17, 2022
Africa is the fastest-growing continent and is home to 600 million people. It also has one of the lowest savings rates, making it a challenging market for investors. However, this doesn’t mean there aren’t opportunities and great potential in Nigeria. With its low starting capital, competitive business environment and growing economy, Nigeria is an ideal location for startups and SMEs with limited funding.
For example, remittances — the function through which you transfer money from a foreign country to another — are highly efficient ways of raising capital. That makes obtaining funds from your home country much more accessible than in many other African countries. With almost 50 percent of Nigerians living below the poverty line as of late, remittances are even more critical. Here are five reasons why it is convenient to transfer money to Nigeria from the UK:
1. Remittances Are Highly Profitable
Nigerians are among the World’s most desperate remitters. That’s why the country’s average remittance amount is high and has been increasing. It has jumped from $1.5 billion to $8 billion in the past few years. This growth has been fueled by the high return on investment (ROI) rates in African remittances. For instance, someone sending $10,000 home would get back $11,000 after ten years. With this kind of return on investment, it’s no surprise that many people are now sending money home.
More importantly, the high rates of return in remittances are also driven by the increasing demand for financial services in Nigeria. For example, the country’s growing middle class is looking for better banking services and products. With the ever-increasing demand for financial services and the high rates of remittance return, the Nigerian remittance market is highly profitable. That makes it an excellent market for investors.
2. There’s a Growing Demand for Financial Services
Besides being a profitable market, Nigeria is also one of the fastest growing economies in the World. This means there’s an increasing demand for financial products and services. For instance, there’s a growing demand for savings products like fixed deposits and loans. That’s why the Nigerian banking sector is growing at an impressive rate.
It has been growing at an annual rate of 12 per cent, making it one of the fastest growing sectors in the World. With this growth, the Nigerian banking sector has also been extending credit to customers. For example, one in five Nigerians has a credit card. Furthermore, the Nigerian government has been encouraging financial inclusion by offering incentives like tax holidays for investments in banks. This is expected to increase the demand for banking services.
3. Average Salary Is Low, but Growth Is Rapid
With Nigerians being among the hardest working people in the World, the country also has one of the lowest average salaries. That’s why, when someone sends money home, they receive a minimal amount. For instance, an average Nigerian would receive $200 after sending $2,400 home. Nevertheless, this $200 has enormous potential. That’s because the average Nigerian would spend this amount on their daily needs. With this massive demand for cash and the high rates of return on investment in remittances, the Nigerian market is growing rapidly. That means the market is also becoming more mainstream. The market is already mainstream and expected to grow even further. That’s another reason investors consider it profitable to send money to Nigeria from UK.
4. Nigerians are one of the World’s Most Reliable Consumers.
While many financial service providers find it challenging to attract and retain customers, Nigerian consumers are very loyal. That’s why the market is also highly reliable for service providers. For example, customers in the Nigerian remittance market are very dedicated to their remittance providers. That’s because the market is also highly controlled. That means companies offering remittance services in the Nigerian market must comply with stringent regulations.
Moreover, customers in the Nigerian market are also very serious about financial services. That’s why the market is also great for financial services providers. These make the Nigerian market highly reliable for financial services and a profitable market for investors.
5. Technology Is Improving the Market Continuously
With Africa’s fast growth and high potential, financial technology (Fintech) companies are increasingly eyeing the continent. Since the continent’s remittance market is worth billions of dollars, it’s not surprising to see significant investment in the sector. Despite the growth of Fintech companies, traditional remittance providers have also been trying to keep up.
The good news for Nigerians looking to send money back home is that multiple international money transfer services allow people to send money to Nigeria. It’s now easier than ever to send funds, as technology makes remittance cheaper and more convenient.
With all these in mind, it’s not surprising to see that Nigerians are among the most eager remitters in the World. The market is growing rapidly, profitable and highly reliable for companies offering financial services. With so many advantages, it’s no wonder that many are trying to invest in the Nigerian remittance market. The question is, are you among them?