According to its 2018 full year results, financial services holding company the Equity Group confirmed that diaspora transaction volumes grew by 196% to Kshs 107-billion, while the commissions recorded a 169% rise from Kshs 279-million in 2017 to Kshs 751-million after the same period last year.
The company described its business model and strategy as "unique" and said these create resilience "while managing headwinds of interest rate capping and challenging macroeconomic and business environment."
In a presentation of the results, Equity Group CEO & MD Dr James Mwangi noted that remittances have taken a significant market share moving from Kshs 36-billion to Kshs 107-billion - and the hope for this year is that it will surpass Kshs 200-billion in diaspora remittances processing "simply because of FinTech capabilities."
In a statement released by the company, Equity Group will continue to invest in solutions through innovations and strategic partnerships with global money remittance outlets targeting Kenyans living and working abroad.
"The Diaspora business segment offer a wide range of services tailored to suit the banking needs for money transfers, payments and investments," it stated.
The company also references CBK data and highlighted that total cash inflows from foreign countries increased by 39% to Kshs 274.37-billion in relation to Kshs 198.07-billion in 2017.
June recorded the highest diaspora remittances with US leading followed by Europe and the rest of the world inflow earnings.
In 2018, Equity Group profits grew to Kshs28.5-billion; a profit growth of 6% and a 13% growth in customer deposit.
According to the company its customer base grew to 13.5 million clients and customer deposits grew at 13% to reach Kshs 422.8-billion - up from Kshs 373.1-billion driving the growth of the balance sheet to reach Kshs 573.4-billion up from Kshs 524.5 billion the previous year.
Remittances key to growth
In January 2019 Andrew Stewart, Managing Director for Middle East and Africa, WorldRemit, said the key to unlocking Southern Africa's growth potential depends on the ability to reduce the average cost of sending money home among its large migrant population which numbers over 3.2 million.
"After a slowdown in recent years, Africa is experiencing an uptick in growth. West and East Africa are leading the way: Ethiopia is predicted to grow at 8.5% in 2018 while Cote d'Ivoire and Senegal aren't far behind at 7.4% and 7% respectively. However, while Southern African countries like Botswana, Namibia, South Africa and Swaziland may lead in measures of human development, the SADC region is one of the slowest-growing regions on the continent, averaging 2.9% in growth,"
"While the SADC region leads in regional integration, the high cost of sending remittances across borders within the region, curtails their transformative impact. Cheaper remittances will boost growth: we know remittances increase when the costs fall and joint UCLA-IMF research shows that higher remittances can boost growth."