Tanzanian-based fintech, NALA, has announced partnership with Cellulant to power remittance payments from the UK and the US, into Kenya, Uganda, Rwanda, Tanzania and Ghana.
The partnership with Cellulant aims to facilitate seamless cross-border payments and significantly reduce the cost of sending money from the UK and the US into Africa.
Transaction fees absorb a large percentage of the billions sent to Africa every year. The cost of sending money into Africa is the highest across all regions. Tanzania and Kenya remain the highest with charges at 17% and 21% respectively for every $200 sent. With increased intra-African trade and between Africa and the rest of the world, the transaction cost is one of the barriers to success in facilitating cross-border payments.
Besides Official Direct Assistance (ODA), remittances make up the second-largest source of external resources for Sub-Subsaharan Africa. In 2019, approximately $48 billion was remitted in Africa, with Nigeria receiving roughly 50% of this amount, followed by Ghana and Kenya. Despite a decline in remittance inflows in sub-saharan Africa in 2020 due to the Covid-19 Pandemic, countries such as Kenya and Ghana experienced an increase in cross-border payments. Remittance inflows into Sub-Saharan picked up again and grew roughly by 6% in 2021.
NALA is a Y-Combinator backed company which provides Africans living in the UK and the US a way to send money to the continent easily. NALA has been active in East Africa and Ghana with plans to expand into Nigerian, Ethiopia and Canadian markets.
Cellulant provides a single API payments platform, Tingg, that enables global, regional and local businesses to collect payments online and offline while allowing anyone to pay from their mobile money, local and international cards or directly from their bank. The platform powers payments for 220 million consumers on a single inclusive network, allowing interoperability across Africa.
What they said:
“Today, Sub-Saharan Africa is the most expensive region to transfer money into,” NALA’s Chief Operating Officer, Nicolai Eddy, said. “In Tanzania and across the African continent, there is a huge opportunity to harness technology to reduce payment fees and build next-generation payment and banking products. At NALA, we’ve built a completely digital platform for individuals and businesses based in the UK and US to send money to their friends, family, and employees in Africa. Cellulant is one of the early payment pioneers on the continent, and we chose to partner with them because of their deep expertise in the space and their strong technical capabilities.”
“Cellulant solves a huge challenge for businesses coming into Africa since they have to deal with 54-55 different payment providers and multiple currencies, with at least one for each country. With our presence in 35 countries, we are able to cover all these needs through a Single platform, Single API, Single contract, One web tool and a Single point of managing all operations. This partnership complements Nala’s fully digital cross-border payment capabilities with the necessary infrastructure to enable them to deliver their services in the continent effectively,” said David Waithaka, Cellulant’s Chief Revenue Officer.
