Marginal rural populations in Uganda are able to access key financial services through an app developed by Inpay and Eurogiro in collaboration with PostBank and Posta Uganda.
The UN’s International Fund for Agricultural Development (IFAD) and partners have joined forces to make the cost of sending money through mobile channels from Europe to Uganda four times cheaper. Use of the app generates significant savings for migrant workers and their families in rural areas and helps them to access additional finance.
IFAD has provided a EUR 369,000 grant to 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 jointly contributed EUR 172,000 to co-finance the venture over an 18 months period.
Uganda ranks in the top 10 of remittance recipient countries of sub-Saharan Africa. Money can take days to be delivered and costs exceed 10 percent of the amount sent, including the foreign exchange margin, adding unnecessary strain and cost on migrant workers and family members back home.
“These remittances are a lifeline for rural people. However, the cost of sending money to Uganda is still far above the SDG target 10.c of reducing the cost of migrants’ remittances to less than 3 percent by 2030. Mobile channels offer a great opportunity to achieve this goal,” added De Vasconcelos.
The partnership builds upon a previous IFAD grant to Postbank Uganda (PBU) and Posta Uganda between 2017 and 2020. IFAD support helped extend financial services, including remittances, to rural and refugee communities, and supported the refurbishment of 30 post offices, opened new mobile branches, and procured mobile cash management vans in rural areas.