Barclays Kenya has launched a free international money transfer service as it seeks to widen its customer base and share of deposits from diaspora remittances. The bank has rolled out Barclays Pingit, a service that will initially be available between the UK and Kenya, leveraging on the high level of mobile phone penetration.
The person-to-person money transfer service has been operational in the UK and allows sending and receiving up to £750 (Sh63,750) per day through mobile phones, irrespective of the mobile network.
Pingit links the user's current account with their mobile phone number, enabling payments to be sent directly to that account. Senders and recipients are notified about transactions via SMS.
Users however must have smart phones to download the application, and mobile numbers. Recipients in Kenya will have to open accounts with Barclays which will be linked to their mobile numbers via its Hello Money mobile banking service. "Kenya is ranked among the world's top five in mobile banking, but there have been two missing links that we seek to exploit," said Adan Mohamed, BBK managing director.
"First, banks have so far restricted themselves to their own customers. Second, mobile financial services are still largely restricted to domestic payment. Pingit cuts across these barriers." Data from the CBK show Europe accounted for 30 per cent of total remittances in June at $29.81 million (Sh2.5 billion) from $28.13 million (Sh2.4 billion) in May.
Formal remittances inflows have been on the increase owing to lower international money transfer charges and increased convenience of mobile transactions. More Kenyans in the diaspora are also now trading in government securities after the CBK revised its investment procedures in 2011.