How start-ups reduce the cost of remittances

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Remittances are a lifeline to workers’ families back home, providing necessities such as food, medical care and education. Yet transfer fees are high, diverting funds away from those who most need them. At the same time, there is an opportunity to leverage remittances to support long-term development and financial inclusion via investments, savings and entrepreneurship. So how can we make remittances better for long term development, as well as faster and cheaper for those sending and receiving them? Supported by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), and in cooperation with the Frankfurt-based innovation platform TechQuartier, the Pilot RemTech Accelerator put this question to start-ups to the 22 partner countries of the GIZ Programme Migration & Diaspora (PMD) around the world. The goal is to find business plans that offer innovative, technology-based solutions and help to reduce costs and improve the development-oriented use of remittances.


We´re always searching for the most efficient way to transfer money – Is it Online or with the help of a bank? Does it cost anything? One thing is for sure: it is not uncommon to incur high fees for transfers abroad. Especially for people with a migration history who live in Germany and want to transfer money to family and friends abroad - called remittances - this is a challenge. But there are start-ups that are developing solutions for this problem. The goal is to find a way to make remittances more sustainable and effective.

These approaches were the focus of the Pilot RemTech Accelerator, which the Programme Migration & Diaspora (PMD) of the GIZ organized together with the Frankfurt-based innovation platform TechQuartier at the end of September. Twelve start-ups from the RemTech and FinTech sectors in Ecuador, Nepal, Nigeria, India, Cameroon, Tunisia, Kenya and Indonesia were able to present their ideas.  The focus was on how to use remittances to promote long-term development and financial inclusion through investment, savings and entrepreneurship. The BMZ supports these efforts, as there is an international commitment to reduce costs and improve the development-oriented use of remittances.

At the virtual pilot Accelerator, things got down to business: Programme highlights included one-on-one pitch coaching sessions, keynote addresses, round tables, meetings with experts in different fields and virtual speed dating sessions with potential investors, business partners and the BMZ.  The Pilot Accelerator peaked with the Demo Day, where the finalists had the opportunity to present their ideas - in the form of a 5-minute pitch, followed by a Q&A session by the 5-member jury. In the end, there were three winners:

First place went to the startup Friendly Transfer from Ecuador, which accepted the prize money of 4000 cEuro. The startup convinced the jury with the idea, that friends around the world can connect using a social platform and send money locally without losing part of their income due to international transfer fees. "We knew we would be showcasing FriendlyTransfer to an audience that could truly understand the impact our platform is having at significantly reducing the cost and time involved in international transfers," said Gidany Cobo, co-founder and CEO of Friendly Transfer. "We participated because it is a challenge that is fully focused on remittance innovation. Seeing our model being ‘validated’ by a group of peers and experts working in the remittances industry, encourages us to work even harder on scaling FriendlyTransfer and its impact."

Second place went to duaPay (1500 cEuros) from Kosovo: they developed a community marketplace and payment service that changes the current use of globally fragmented community connections. For this, they created a next-generation mobile platform.

Third place went to  Flow (1000 cEuros), based in Tunisia: they developed an online wallet that enables international payments via peer-to-peer exchange. This reduces fees to less than 1.5%.