BRUSSELS, 29 April 2016 – The European Commission's EuropeAid recently released a new video that highlights the success in Benin of the African Postal Financial Services Initiative (APFSI), of which WSBI-ESBG served as a partner. Released as part of an effort to celebrate the European Year for Development, the five-minute video, titled How developing countries can benefit from remittance flows, looks at how people in mostly rural areas of the West African nation have benefited from the European Commission-funded, remittance-focused APFSI. Part of a series of six theme-based videos available on Youtube, provide concrete examples of how people in local villages have improved their lives thanks to the programme.
Project aims: enhanced remittance market competition
Launched in 2014, the regionally focused effort aims to enhance competition in the African remittance market place by promoting and enabling African post offices in selected countries to offer remittances and financial services. The Initiative has four main objectives. First, to reduce the costs of remittances to and within Africa, which are among the highest in the world, especially for the rural poor. Second, to reduce transaction times via more up-to-date procedures for transferring money. Third, broaden the network of rural locations where remittances can be picked up, reducing the time lost and risks for rural dwellers, and finally, to deepen the range of financial services to remittances senders and receivers, namely savings, loans and insurance products.
The two savings and retail banking trade bodies had an important role in the programme. Among many tasks, it led implementation efforts around postal services provider La Poste du Benin's business development and commercial management work as well as financial management components at the La Poste du Benin.
WSBI-ESBG's staff have been involved throughout the project in active participation in programme design and implementation through project steering committee meetings. They have also deployed retained experts to postal operators selected in the four countries – Benin, Ghana, Madagascar and Senegal – to receive technical assistance under the programme. It also has developed and delivered a management seminar for senior managers in Arusha, Tanzania, and training of trainers programmes in each of the four countries.
Part of multi-party effort
Associated partners who also contributed in ther overall APFSI effort included the lead firm International Fund for Agricultural Development (IFAD) Finance Facility for Remittances along with the World Bank Group (WBG), Universal Postal Union (UPU) and the United Nations Capital Development Fund (UNCDF).
Why it's important
Post offices in Africa are ideally placed to deliver remittances and other financial services in rural areas due to their country-wide networks. However, being frequently underfunded and in many cases with less technical sophistication than IMTOs, they are at a disadvantage during negotiations to act as agents in serving receiving customers. Up to a fifth of the value of every US$100 sent to Africa is held back by global remittances companies. The programme tries to address this by finding ways to bring market-based solutions into play to drive down the costs charged by international money transfer operators (IMTOs).
The programme is set to conclude in August 2016.