Vodafone and Citigroup announce worldwide mobile financial remittance venture

Vodafone and Citigroup Corporate and Investment Banking's Global Transaction Services business today announce their plan to launch a Vodafone-branded mobile-based international money transfer service targeting the global remittance market worldwide.  The new service will provide senders and receivers of money with a superior method for sending money home that is convenient, cost-effective, secure, transparent, and easy to use. 

This initiative couples Vodafone's global reach, brand recognition and operational mobile money transfer service with Citigroup's worldwide network, unrivalled international payments capabilities and existing global remittance solution.  It builds upon Vodafone's recent successful pilot of the M-PESA mobile money transfer service by its affiliate in Kenya, Safaricom.

It is anticipated that Vodafone customers in the United Kingdom will have the first opportunity to use the service to send money to Kenya on a trial basis and both parties plan to launch commercially, with a focus on Eastern European and Asian markets, such as Poland and India, in the near future.

Uniquely, the product being developed will allow the remitter and the beneficiary to choose from a range of options as to how the money is sent and received.  The sender can initiate the transfer using either a mobile phone or a secure Internet website to give instructions on where to send the funds.  The funds will be able to be received in a bank or through the receiver's mobile phone in the form of a voucher and secure PIN that will enable the receiver to redeem the cash at a wide range of outlets, typically the airtime distribution points operated by the in-country mobile network service provider.  For these latter services, the beneficiary of funds does not need to have a bank account, will have a wide range of locations to collect the funds and only has to be in the possession of a mobile phone that can receive an SMS on any mobile network. 

Enabling money to be transferred internationally from person to person using mobile technology is set to greatly assist the flow of funds from migrant workers back to their families.  Migrant remittance is an important source of income in many developing countries - indeed the United Nations estimates that it involves some 191 million migrants and the World Bank estimates it has a total annual worldwide value of USD268 billion.  For some individual recipient countries remittances can be as high as a third of GDP. 

Alan Harper, Director for Group Strategy and New Business, at Vodafone said: "This agreement with Citigroup has the potential to create a step change in global remittance services and one in which the mobile service provider plays a central role.  Vodafone's international brand recognition and our successful trial of M-PESA in Kenya combined with Citigroup's global remittance service and international financial reach, enables us to offer an extremely competitive product compared to conventional remittance solutions available today."

Michael Joseph, CEO of Safaricom in Kenya said: "Safaricom and Vodafone's M-PESA mobile money transfer service is an example of Africa leading the world in the advancement of mobile technology and its uses.  In Kenya, we have been testing the response to mobile-based payments services and we believe that there is a great deal to be gained for the consumer as well as for mobile and financial sector companies.  This opportunity with Vodafone and Citigroup to extend the offering to support international remittances can benefit not only Kenyans, but also the greater population of migrant workers across the world."

Francesco Vanni d'Archirafi, Region Head of Citigroup Global Transaction Services for Europe, Middle East and Africa and Chairman of Citibank Europe plc, said: "The combination of Vodafone's international mobile network and Citigroup's global footprint will create a solution that will benefit communities that use money transfer services worldwide.  We are proud to be using our global distribution network and cross-border payment capabilities to provide migrant workers with a cheaper and more secure way of sending money."

Redactia BankNews.ro