Nigerian fintech company recently announced its launching in the UK as part of a major global expansion drive, joining the league of Nigerian banks that have expanded their operations beyond Nigeria.
The Kuda’s expansion to the UK comes after a total investment of over $90 million USD.
The bank, in a statement, said its operations in the United Kingdom target at providing direct debits and local transfer services for Nigerians in the UK.
Vanguard gathered that the direct debit and transfer services will be supported by Modulr, a UK-based third-party financial services provider.
Here is what you need to know about how the Kuda Bank launch in the UK can save Nigerians millions of pounds.
Combatting high remittances costs
With the launch in the UK, Kuda will enable hundreds of thousands of UK-based Nigerians to combat high remittance costs on large transfers which currently average out at eight percent, according to The World Bank–KNOMAD staff calculations and Remittance Prices Worldwide 2020, which is significantly short of the UN Sustainable Development Goal target of 3%.
The businesses’ vision is to give all Africans globally access to friction-free and affordable financial services, connecting the diaspora with Africa and increasing financial inclusion.
Kuda is entering the UK market (through its UK-based subsidiary – Kuda EMI Limited) charging a flat fee of only £3 with a transfer limit of £10,000.
With over £3 billion sent from the UK to Nigeria every year, the bank is set to save UK Nigerians millions of pounds.
Kuda and the growth of fintech
Parent company Kuda Technologies Limited was founded in 2019 by two Nigerians, Babs Ogundeyi and Musty Mustapha.
The business rapidly expanded to become the country’s number one money app, with nearly five million customers.
Remittance accounts for nearly 1% of Nigeria’s total GDP but the UK to Nigeria payment rail has been notoriously unreliable, with high fees.
Kuda’s digital-only approach and unique local market knowledge has allowed it to launch a service that drives prosperity for both senders and recipients. Kuda’s UK entity will also offer a mobile wallet, virtual and physical cards, local UK transfers and direct debits.
Commenting on the launch of the UK app, CEO and co-founder Kuda Babs Ogundeyi said, “Africans in the UK are faced with barrier after barrier when it comes to financial services – from challenges setting up accounts to prohibitive and inconsistent fees on meaningful transfers.”
They are forced to limit each transfer to a few hundred pounds to avoid losing money or face escalating exchange rates with bigger transfers.
How tech evolves financial services
Technology means the world is getting smaller but the incredible transformation in financial services hasn’t been inclusive. Kuda is changing that – initially for Nigerians, then all Africans in the UK and across the globe.”
The Kuda App will be available on iOS, Android and the web, initially offering UK-to-Nigeria remittance, with plans to expand the remittance service to other African countries and expand the feature portfolio for UK customers in the near future.
In addition to the financial services being launched in the UK, several functions will also be launched simultaneously on the Kuda App for its Nigerian customers.
Nigerians can now make investments in shares, make cardless withdrawals at the ATM and set up micro-saving plans on the Kuda app.