The growth in the global adoption of mobile devices has driven the use of digital technology in remittance services and cross-border payments, Agusto & Co has said.

It stated that COVID-induced movement restrictions significantly amplified the utilisation of digital money transfer channels. It estimated that in 2021, following lockdowns and border closures across the world, mobile phone payments spiked by 48 per cent.

In its latest report titled ‘Nigeria’s Diaspora Remittances: A Tale of Emigration, Policy and Technology’, the firm claimed that there had been a shift towards fintech money transfer, and traditional money transfer operators were increasing their digital presence but struggling with the switch.

It said, “Furthermore, there has been a shift to Fintech MTOs, which provide users with a faster, more convenient, and cost-effective remittance experience.

“Traditional Money Transfer Operators have begun to adjust to the new normal by building a hybrid structure. Agusto & Co. believes that this structure gives businesses an advantage by allowing them to benefit from the dependability and convenience of physical locations as well as the accessibility of digital solutions by having both a digital presence and a real address.”

The firm further projected that remittance flows into Nigeria would rise to about $26bn by 2025. It said the rise will be supported by improved economic conditions in advanced economies.

“Therefore, Agusto & Co. expects remittance flows into Nigeria to rise to about $26bn by 2025. This will be supported by improved economic conditions in advanced economies,” it noted.

The firm opined that the slow economic recovery and cost of living crises that confronted many developed economies in 2022 constrained remittance flows into Nigeria and was further exacerbated by the implementation of capital controls and other unpopular policies by the Central Bank of Nigeria, which also restricted inflows through official channels.

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