A new app called PostalPay will, it is claimed, slash the cost of sending money from parts of Europe to Uganda.
The UN’s International Fund for Agricultural Development (IFAD), Inpay, a cross-border payments company, and its subsidiary company Eurogiro, a global postal cross-border payments network, have joined forces to make the cost of sending money through mobile channels from Europe to Uganda four times cheaper.
Created by Inpay and Eurogiro in collaboration with PostBank Uganda and Posta Uganda, the new PostalPay app will enable people located in the EU to send remittances to Uganda in a cheaper, but also faster and safer way from their mobile phones. Use of the new app will also generate significant savings for migrant workers and their families in rural areas and help them to access additional finance.
Money can either be instantly transferred to a PostBank bank account or received as a cash pick-up in multiple Posta Uganda and PostBank Uganda locations.
“By using our cross-border payment technology, we are cutting the total costs of remittances to 2.5 per cent,” says Thomas Jul, CEO of Inpay and Eurogiro.
An IFAD €369,000 grant (US$367,457) will support the launch of PostalPay in Sweden and the Netherlands, two European countries with an established Ugandan diaspora. The IFAD contribution is part of the PRIME Africa Programme, co-financed by the European Union with additional support from the Government of Luxembourg. Inpay and Eurogiro are jointly contributing €172,000 (US$ 171,280) to co-finance this venture over the next 18 months.
In 2021, remittance flows to Uganda (some US$1.08 billion) represented almost 3 per cent of national GDP.
This partnership builds upon a previous IFAD grant to Postbank Uganda and Posta Uganda between 2017 and 2020. IFAD support helped extend financial services, including remittances, to rural and refugee communities, supported the refurbishment of 30 post offices, opened new mobile branches, and procured mobile cash management vans in rural areas.