Africans Are Paying 19X More Than Europeans To Send Money

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According to World Bank data, intra-African fees for a $200 cross-border transfer averages 9.5%, which is 19 times higher than in Europe, and nearly double the cost of sending the same amount from the U.S. to Latin America.

The cost of moving money across African borders is not just a financial inconvenience – it’s a systemic drag on households and entire economies. New World Bank data highlights the scale of the issue: Africa pays a premium unmatched anywhere else, despite being one of the regions most dependent on remittance inflows. Understanding why these fees remain so high is essential for policymakers, fintech innovators, and millions of migrants who send vital support home each year.

Why African remittances cost so much more than anywhere else

The World Bank wants to reduce this cost to around 3%, but that’s a target that has been missed for the better part of a decade. This equates to an extra $9–$19 per $200 sent compared to Europe or the Americas, or $2–4 billion a year in fees based on Africa's $96 billion remittance inflows in 2024. Sub-Saharan Africa remains the world's most expensive region overall.

This is no trifling matter, but the reasons for Africa’s higher transfer costs have to do with the absence of competition relative to the U.S. and Latin America, and the Single Euro Payments Area (SEPA) which makes sending payments within the Euro zone almost free, and as simple as making a domestic transfer.

Cost of remittances in Africa versus Europe and the Americas
Region	Average fee (%) for $200	Absolute cost ($200)	Background
Intra-African	9.5%	$19	Up to 16% between Nigeria and Ghana. Costs are high due to weak competition and informal channels.
Intra-Europe	0.05-0.5%	$0.10-$1	SEPA transfers within the euro area are nearly free for banks; average for cross-border B2B/small transfers is ~0.05%.
U.S. to Latin America	5%	$10	U.S.-Mexico transfers average 5%. Costs have fallen due to fintech-driven competition.
Global average	6.5%	$13

Initiatives like the African Continental Free Trade Area aim to reduce intra-African costs through better integration, but this remains very much in the early development phase. Ultimately, the idea is to have a system like Europe’s SEPA to lower the costs of intra-African transfers. Currently, intra-African trade accounts for just 16% of the total, the result of skewed development that directs trade to the West and Asia.

The World Bank estimated global remittances to Africa at close to $100 billion in 2024, up from around $90 billion in 2023. This is more than the combined foreign direct investment (FDI) into Africa.

Remittances from family members and friends working abroad form a huge part of many African economies: as much as 21% of the GDP of Gambia and Lesotho, and between 8% and 12% for Morocco, Nigeria and Senegal. Nigeria and Egypt account for the largest absolute inflows – about $20-$22 billion each annually – so the costs of these remittances represent a staggering loss to the local economies.

Africa: remittances as a percentage of GDP
Rank	Country	Remittances (% of GDP)	Highlights
1	Gambia	21.1%	Highest in Africa; primarily from UK and U.S. migrants.
2	Lesotho	20.9%	Driven by South African mine workers' diaspora.
3	Comoros	18.3%	Flows mainly from France.
4	Somalia	17.5%	Large informal channels supplement official data.
5	Liberia	14.3%	Post-conflict recovery aided by U.S.-based diaspora.
6	Cabo Verde	12.1%	Strong ties to Portugal and the U.S.
7	Senegal	11.6%	From Europe (France, Italy) and Gulf states.
8	Nigeria	11.3%	Largest absolute inflows ($19.8B), but moderate % due to large GDP.
9	Morocco	8.1%	Mostly from migrants working in the EU.
10	Egypt	7.6%	Massive absolute flows ($22.7B), but lower % relative to economy size.

The disparity in remittance costs is the result of structural, market and regulatory factors. Africa comprises 54 countries, each with different currencies, regulations and anti-money laundering (AML) rules. There are also varying licensing rules and capital controls which raise operator costs which are, in turn, passed on to customers.

This discourages competition, while the relatively low volumes of funds being transferred between African countries compared to Europe, Asia and the U.S. means higher buy-sell spreads when dealing through the banks or money transfer companies.

Despite the strong emergence of fintechs and mobile money operators in East Africa, and South Africa’s well developed financial sector, most African countries lack a robust digital payments system. The result is ongoing reliance on informal cash-based channels such as hawala networks, an ancient, trust-based informal money transfer system that moves value across borders quickly and cheaply without physically transferring funds, relying entirely on a global network of brokers settling debts later.

Stablecoins are slashing the costs of transfers

The emergence of stablecoins in the last six years has slashed the costs of cross-border transfers to 1% or less, and has the potential to upend the entire cross-border payments market in Africa. Stablecoins like Tether and USDC are cryptocurrencies pegged to the U.S. dollar and logged on the blockchain. These could save Africa $4.8 billion a year if just 25% of flows shifted to the blockchain, according to The Banker.

In 2024, they accounted for 43% of sub-Saharan Africa's crypto transaction volume, driven by Nigeria's $22–59 billion in activity, as users leverage them for cross-border payments in a climate of high inflation and currency volatility.

For example, a Nigerian freelancer receiving payment of $400 from Ghana via stablecoin pays about $0.50 total compared to $40–$70 through the traditional banking system, bypassing slow correspondent banking routed through Europe and the U.S., which handle 88% of intra-African flows.

In November 2025, Mastercard and South African bank FNB launched Globba, a low cost method of transferring funds to 120 countries and converting to 150 currencies, with multiple ways to cash out. Recipients can opt to receive funds in a bank account, wallet or cash point. This new system makes smart use of many different payment rails, including stablecoins.

What stops faster stablecoin adoption

Stablecoins are a creature of the digital age, and an outgrowth of the crypto revolution. Initially conceived as a way for crypto speculators to park their profits in something more stable (such as a USD-pegged stablecoin) without having to re-enter the banking system, their use cases have multiplied. They are now used for international trade, remittances and overseas trips, to name a few.

The problem with blockchain-based transactions is that they cannot be reversed. Enter a wrong address and the funds are lost. You cannot phone a bank and ask them to reverse the transaction. In other words, crypto lacks a SWIFT-type system used by international banks to verify cross border transactions – and, potentially, reverse them in the case of fraud or error.

The crypto world is fast merging with the traditional banking space. A company called RemiDe has developed a SWIFT-type database that will allow bungled or fraudulent crypto transfers to be intercepted and reversed.

“One of the main innovations that SWIFT introduced 50 years ago was it united all financial institutions into a network, and networks are much more efficient than building individual bilateral connections. This is what is happening right now in stablecoins,” says Anton Titov, founder and CEO of RemiDE.

“Blockchain is irreversible and a lot of financial institutions and board directors with whom I'm talking, they’re all complaining about that. It's a huge problem. But if all digital wallets are managed under financial institutions, it means that there is a possibility to make a recall. You can contact your financial institution and say you sent money to the wrong address, please refund us.”

This plugs a critical trust gap that has prevented wider adoption of crypto in Africa, adds Titov. Once the crypto space starts to operate more like the traditional financial space – only faster and cheaper – then Africa will start to see accelerating stablecoin adoption.

Another African invention that promises to boost stablecoin adoption is Spendl Money, a card-based system for spending up to 12 cryptocurrencies (including stablecoins) anywhere that Mastercard is accepted. It’s the brainchild of tech entrepreneur Greg van der Spuy, whose vision is to reduce remittance fees to near zero. How does the company make money when no fees are charged? With some fancy financial engineering in the background which generates yield on money flowing through the system and passes that on to customers in terms of zero or very low fees. This is the future into which Africa is now treading.

Greg van der Spur, founder of Spendl Money

The technology to cut Africa’s transfer fees is here

Africa’s 9.5% intra-continental remittance fees – 19× higher than Europe’s near-zero SEPA costs – represent a silent $3–4 billion annual tax on the continent’s poorest families. Stablecoins have already driven real-world transfer costs below 0.5% in high-adoption corridors like Nigeria–Ghana, proving the technology works today.

The only remaining barrier is regulatory trust and reversible transaction infrastructure. Once those fall into place, adoption will accelerate rapidly and the World Bank’s 3% target could become obsolete within a few years. Is it likely? Probably not as fast as many would like to see, but it is inevitable. The Mastercard-FNB low-cost Globba system shows how rapidly traditional financial players are solving the problem. Others will follow, using stablecoins and blockchain in the background, without customers even knowing it.

Conclusion

The persistent disparity in remittance fees—Africans paying, on average, 19 times more than Europeans—highlights a pressing injustice in the global financial system. Structural barriers, limited competition, and reliance on traditional money transfer operators keep costs high for African families, eating into critical funds meant for education, healthcare, and daily necessities. However, emerging technologies such as mobile money and blockchain-based platforms offer a real chance to disrupt this status quo, as evidenced by Kenya’s M-Pesa revolutionizing domestic transfers. The key takeaway is clear: embracing innovation and fostering a more competitive landscape can transform remittances from a costly burden into a powerful engine for economic empowerment across Africa.

FAQs

How do remittance fees in Africa compare to other global regions?

Remittance fees within Africa average 9.5% for a $200 transfer—19 times higher than intra-European transfers and nearly double the U.S. to Latin America rate. Globally, the average is 6.5%, highlighting Africa as the most expensive region for sending money.

What role do informal money transfer channels play in Africa?

Due to limited digital payment options and high formal transfer costs, many Africans rely on informal channels like hawala networks. These systems move funds quickly and cheaply without physical cash movement but operate outside formal regulatory oversight.

How might digital financial technologies reduce remittance costs in Africa?

Technologies such as stablecoins and digital payment systems have already demonstrated the ability to lower transaction fees to as little as 0.5% or less in some African corridors. Wider adoption could further reduce costs, provided regulatory trust and transaction reversibility are addressed.

Why is intra-African trade and remittance integration still limited?

Intra-African trade makes up just 16% of the continent's total, mainly due to fragmented regulations, multiple currencies, and limited financial integration. This hampers the development of unified, low-cost remittance systems similar to those in Europe.

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Team that worked on the article

Ciaran Ryan is a veteran financial journalist based in South Africa, where he covers cryptocurrency, mining, stock markets, and governance for Moneyweb. He also hosts the weekly Moneyweb Crypto Podcast.

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Dan Blystone began his trading career in 1998 as an arbitrage clerk on the floor of the Chicago Mercantile Exchange (CME). He later traded bond and Eurex futures at proprietary firms such as Altea Trading, gaining valuable experience in high-frequency trading and risk management.

Chinmay Soni is a financial analyst with more than 5 years of experience in working with stocks, Forex, derivatives, and other assets. As a founder of a boutique research firm and an active researcher, he covers various industries and fields, providing insights backed by statistical data.

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