Isuru Karavita

Isuru Karavita

He graduated from the university of Hertfordshire with a BEng(Hons) in Digital Communication and Electronic Engineering. 

Wednesday, 31 January 2018 16:41

Mobile Money: A Tale of Two Countries

Mobile Money is a developing platform that started as a payment service from your mobile and is now evolving into a platform to include other financial services. You can access your money anytime, anywhere without having to go to a traditional bank. This is widely used in the UK but for low-income people in other countries, it can be the lifeline they need. The low-income population in some countries are also known as the ‘un-banked’. The ‘un-banked’ do not have access to a bank account and, therefore, no access to the services offered through a bank. With mobile money opening the door for those in need of banking services, it is becoming more and more of a necessity. It can empower the unbanked population by providing basic financial services and financial inclusion. This can help businesses grow and make trade easier.

 

We will look at two countries in Africa to investigate the best mobile solutions. Kenya is the largest economy in East Africa. Nigeria is the largest economy in West Africa, and in Africa as a whole. You would think that, due to the economic standings in Africa, these countries would have similar experiences with using mobile technology but these 2 countries have experienced very different outcomes when it comes to the Mobile Money industry.

 

Kenya’s mobile money is being led by the telecom industry and has had great success. Safaricom entered the market in 2007 and invested in a strong infrastructure, including an awareness campaign. The ownership of mobile phones by the ‘un-banked’ led Safaricom to be the leader of the industry. Safaricom can even facilitate a limited range of loans, savings, insurance products as well as financial transactions. The platform is used by many in Kenya, not just the poor, ‘un-banked’ population.

While Nigeria also has a large ‘un-banked’ population and heavy use of mobile devices, the experience is quite different from Kenya. This is basically due to it being based on a ‘bank-led’ model rather than a telecommunications model like Kenya’s mobile money model. In fact, the telecommunication companies in Nigeria have been restricted to providing the infrastructure for Mobile Money, through which bank services can be offered. The Nigerian Central Bank (NCB) has heavily legislated the mobile money industry, making it less attractive. They claim that they have done this to avoid money laundering and also due to concerns about a loss of control. All of this control and restrictions on the telecommunications industry has left little incentive for them to be proactive in offering services. Even MTN, a South African telecommunication company with successful Mobile Money platforms in a number of other countries has fallen into difficulties with the Nigerian Government.

 

This model in Nigeria is doing the population a disservice and the numbers show this as fact. In 2014 a survey indicated that only 0.8 million adults use mobile money. This is in a population of approximately 178 million. Nigeria now needs to catch up, otherwise the unbanked population will be suffering the consequences of not having basic financial services for years to come.

Wednesday, 31 January 2018 16:20

Mobile Credit vs Money Transfer

Transferring money overseas can be easy and difficult at the same time. Questions arise as to whether the recipient can access the money you send and whether it is actually safe to send. The movement of people around the globe has risen with globalization. People moving to a new country want to be able to keep in touch with and support their family and friends that they left behind. In the UK, many people have come from developing countries and they want to send money to their family but they want to ensure that the money is received properly and in good time. Mobile money transfers have grown incredibly due to the ease of use and the immediacy of the transfer. 

 

Due to a technological revolution in developing nations, mobile phones are no longer a luxury. They are a necessity, in order to keep in touch with and receive money from those who have moved away. There are many remote areas in developing countries that do not have land-lines installed but mobile phones can be used. Mobile transfers mean that they do not have to try and make their way to a larger metropolitan area to receive money or talk to their loved ones.

One way to help your loved ones in a developing country is to top-up their mobile with airtime. This can be done very quickly and small or large amounts can be sent. Sending a top-up to someone’s mobile means that person does not have to worry about having to travel anywhere in order to put money on their mobile themselves. If they were unable to receive top-ups they could find themselves unable to travel to an area where they must first access money from a bank or money-transfer company, proceed to the mobile company to put money on their mobile and all of this might not be very easy. Top-up companies often have promotions for the sender, during a certain period, when the sender can send an amount of money to top-up a mobile and the receiver will receive an additional amount of air time. 

Being able to send small amounts helps the senders and their pocketbook. There is no cost, usually, to send these top-ups and a £10 money transfer or top-up costs as much as a £100 transfer. There is no difference dependant on the amount sent. Being able to pay bills for your family in another country is also a big draw for mobile money transfers. You are able to pay a bill directly to the company, avoiding the pitfalls of transferring money to your family so that they, then, must retrieve the money from the transfer and somehow pay their bills in person.  Living in the UK, away from your family and friends, often means wanting to stay connected and mobile transfers are one such way. All with a few swipes on your mobile.

Many people still use one of the many money transfer businesses in the UK to send money home. It is fairly easy to do and it appears to be very safe. The problem with this can be the question of whether the recipient is able to access the money you have sent them. In India, for example, there is very little liquidity of money and the receiving agent might not have the actual cash to give out. You must also keep in mind how the recipient can access the money you sent. Do they have a bank card or debit card? The use of money transfers to India have virtually stopped due to these problems. Using mobile transfers, you can avoid these problems and be assured that your family member or friend received the money. 

 

 

Tuesday, 30 January 2018 12:38

Saving Money Sending Money

Sending money abroad is a huge industry in the UK and navigating the various systems can be a headache. You want to ensure that your money is safe throughout the transaction, but you also want to pay the lowest fees to make the transfer as painless as possible. Your hard-earned money can’t be ‘played’ with lightly, especially given the turbulent political landscape that is the UK right now. The pound has fallen significantly against most other currencies since the Brexit vote and will continue to do fluctuate up and down in the future.

You definitely don’t want to seek out the best exchange rate by jeopardising the security of your money. The last thing you need is to lose your money to a high-risk transfer agency or firm. So you need to do your homework in order to make a transfer that is at a good rate, for a low cost, and is secure enough for you to have confidence in the transaction.

First, consider how much you’re sending and how often you’re wanting to send it. You might want to set up recurring transfers to a family member. Perhaps you’re working in the UK but your family is in another country and you want to help support them. Or, perhaps, your child has gone abroad to school and needs you to help with expenses in another country. You may be investing in another property in another country and you need to send funds to purchase that and pay the fees to the various parties. People in the UK send money abroad for all sorts of reasons; finding the best way to send these funds takes a bit of work but will be worthwhile, in the end.

There are three main ways of sending money: a High Street bank, a transfer firm or a foreign exchange broker. The safest way would be through a bank but you’re unlikely to get good exchange rates and the fees might not be worth it. Bank transfers can also take up to a week to process.
Money transfer firms are good for sending money quickly but the fees will be high and the exchange rates fluctuate widely.

A foreign exchange broker is probably your best bet. Their fees are often low or non-existent, they are fast and their currency rates tend to be highly competitive. The software available to these brokers have advanced wonderfully over the years, allowing them to do money transfers for you at a low rate and quite quickly. Ask around, look for ratings for different brokers on the internet as part of your homework. Don’t go running to your bank just because it seems the easiest way to transfer your money. A little investigative work now will pay off for you in the end.

 

Money laundering is often thought of as a ‘Mob’ type activity. Most people think that they would be involved in it, knowingly or not. Most people would be surprised to learn that in just nine months last year there were 8,652 cases of young people who became ‘money mules’ for money launderers in the UK. The most vulnerable age is between 18 and 24. A ‘money mule’ is someone who moves large sums of cash for a criminal entity in order to ‘clean’ the money by funnelling it through legal channels. Some knew that what they were doing was illegal, but many weren’t aware. A study showed that one third of people would apply for jobs that they think are legitimate but are really ‘money mule’ jobs.

Fake ads are showing up more and more these days and they can be really hard to spot as fake. One way to avoid falling into this trap is to think to yourself – if an offer sounds too good to be true, it probably is. Vulnerable people are those who have little or no income. They are usually young but don’t have to be. Anyone wanting easy cash can fall for these scams and find themselves involved in illegal activities that could leave them facing life-changing consequences such as having your bank account closed to facing a jail term of up to 14 years. Keep in mind that money laundering often supports criminal activities such as people trafficking, drugs, and even terrorism.

Some ways to avoid these fake ads and falling victim to them are: not clicking on any link that is asking you to verify or update your bank account details; not answering a call or text from an unfamiliar number regarding your bank account; remember your bank would never ask you for your
personal information over the phone and would never ask you to transfer money from your account, for any reason; and always respond to emails or phone messages by visiting your bank’s website and calling or emailing a person from the actually bank.

Again, if it sounds too good to be true, it probably isn’t. If you’re unsure about a phone message or email, ask a friend or your bank. Simon Dukes, chief executive of Cifas, said: "This is a serious issue that not only has consequences for the money mule, but for society as a whole. We want to educate young people about how serious this fraud is in the hope that they will think twice before getting involved." So be smart and stay safe.

 

In the world of money exchange the competition is huge. Having great software and an advertising platform that won’t cut into your profits gives businesses the advantage of offering competitive rates. VinIT Solutions has a sound offering of software and now offers a digital advertising system that will give you the edge over your competitors. Don’t toss out your flyers or mailings but, rather, add to their benefits using digital advertising. As with all advertising, you want your business to be a common sight. The more your potential customers see your name and your brand, the more likely they are to reach out to you for business. 

Advertising your business can be costly but with digital advertising you’ll save money and reach more people. Spending on advertising has grown exponentially in the UK, seeing growth every year for the past seven years in a row. Digital formats continue to dominate that market and mobile advertising accounting for 99% of that growth. According to James McDonald, a senior data analyst at Warc, the UK ad industry is experiencing the “most seismic shift” in its history. “Last year exemplified this, as over 95% of the money entering the market came from digital formats. The trend will continue as ad tech improves and consumers spend more time with their internet- connected devices,” he claims. 

To see digital advertising growing year in, year out is encouraging in these unsettled times of Brexit. Advertising has proved to be resilient to uncertainty and digital advertising is helping to lead the way. It provides an electronic communication medium that allows businesses to gain more exposure and reach a greater audience. Being able to reach customers with dynamic images and videos direct to their mobile devices is a boost for advertising. This rings even truer when you’re advertising money exchange software. Information can change quickly, as with exchange rates, for example. 

The business of money exchange is constantly changing. Cutting edge technology has created an exchange world that is able to offer rate changes at lightning speed, in real time. Being able to advertise to your current and future customers through the digital medium will attract customers and is cost effective. We all know how much time is spent on mobile phones and tablets. We also know that many of our customers like to transact business using these devises. Combining advertising with your software is simply the next step in our digital world. 

The Digital Display Systems offered by VinIT Solutions provides you with an electronic communication medium that allows you to gain more exposure and a greater audience. While posters, handbills, leaflets, screen printing and stickers displayed in more visible places to the public was the most popular method of advertising, digital display solutions have come to the forefront of the advertising world. With the invention of digital display solutions, communication has become more flexible and much easier than the printed media.

The printed advertisement isn’t going away any time soon, so don’t rush to do away with that and go all in with digital advertising. Think of digital advertising as an add-on, for now. One day, digital advertising may be the only advertising you see, but that’s doubtful. Customers want both, so utilise your digital presence while maintaining your printed advertisements in order to reach as many potential customers and maintain the ones you have.

Monday, 17 July 2017 16:34

What Exactly is a Bureau de Change?

We´ve all heard of, or at least seen the signs for, a Bureau de Change but what exactly is it and why is it in the French language? Well, it is a business for exchanging currency. The term is originally French but is now widely used throughout Europe and some parts of Canada. Unless you’re in France, you don’t have to worry about the people working in a bureau de change not speaking your language. It actually became the norm when the euro was adopted and is now a prominent name for many exchange offices.

A bureau de change is often located in an area where there are many people such as a bank, at a travel agent, an airport, railway station or large stores. All of these areas have people that might be in need to exchange currency. Airports and railway stations are the most common spots for a bureau de change.

Exchanging currency at a lower rate than what they, themselves, purchased it at is the business they are in and that’s how they make their money. They will often charge a fee for their service, on top of the exchange rate. This fee can be a percentage of the amount being exchanged or it can be a flat fee. Some bureau de change offices will charge both. With the rise of online exchange businesses, the bureau de change offices are feeling the bite into their business and their profit margins are dropping as they try to compete with the online world.

Changing money at a bureau is often a more expensive transaction. Being situated in areas such as airports allows this business to offer services to people in transit who have little choice in the matter. They are stuck at an airport or railway station and need currency exchange. Bureaus also offer the opportunity for money laundering and many countries require them to register as money service businesses so that they are subject to the anti-money laundering measures of a particular country.

You might think that you really don’t need to know about bureau de change but knowledge is power and the more you know about how different businesses conduct money exchange can only help you if you find yourself in need of currency exchange. There are many other businesses out there and you’d be wise to understand what’s best for you and your hard-earned money.

Monday, 17 July 2017 16:03

Feeling-the-Inflation-Squeeze

Inflation in the UK is hindering the household budgets as it has climbed to a four-year high since the Brexit vote. When the pound fell sharply after the vote, the economy started to suffer. In May of this year inflation rose to 2.9%, above the 2.7% that was expected by economists. Inflation has been steadily increasing since the referendum result a year ago, which triggered a sharp drop in the value of the pound and pushed up the cost of goods imported from abroad. Inflation was 0.3% in May 2016, a month before the Brexit vote. That´s a growth of 2.6% in inflation in just a year.

While higher prices for oil have added to the upward pressure of inflation, it really comes down to the weak pound. UK households are seeing higher prices for food and electricity, leaving less to spend on travel and non-essential purchases. As manufacturers are being hit by the weak pound for purchasing goods from overseas, the price rise of their goods for production will mean higher prices for consumers. It appears to be a catch 22, as wages are not keeping up with inflation which leads to the inability to purchase goods that, in turn, help the economy to grow and for inflation to lessen.

There is movement to pressure the newly elected government to help households cope with rising living costs. The TUC general secretary, Frances O’Grady, said “The election showed that working people are struggling. And the biggest price rises in four years won’t provide any comfort.” She also stated that “Working people are still £20 a week worse off, on average, than they were before the crash, and now rising prices are hammering their pay packets again. The new government must stop the real wage slide. Ministers must focus on delivering better-paid jobs all around the UK.”

“Too often there is more month than money left after pay day. Ending the public sector pay freeze and making sure all workers are paid a decent wage is an absolute must and it needs to be on the agenda for the Queen’s speech. Tim Roache, general secretary of the GMB union said. The average wage growth of 2.1% in March is not keeping up with inflation and the inflation increase is expected to widen the gap even further.

The Brexit negotiations are hindering the UK´s ability to shrink the gap between inflation and wages and will continue to do so until everything is settled but that is a long way off. Even interest rates are being affected. The Bank of England is keeping the rate at the record low of 0.25%. Oliver Kolodseike, a senior economist at the Centre for Economics and Business Research consultancy, said: “Under normal circumstances, the Bank of England would have a sufficient set of arguments to justify an interest rate rise. “Under the current circumstances of high inflation and low wage growth, increasing interest rates would only harm consumers further, as they grapple with trying to pay their mortgage and rising bills.

Minimal growth in wages, big growth in inflation, and a weak pound, have all led to a lag in consumerism and the end is not in sight. Paul Hollingsworth, a UK economist at consultancy Capital Economics, is predicting an even higher inflation rate, at around 3.2% in the fourth quarter of this year. This is due to the forecast in costs of production and the price increases feeding down through to the shops and the consumers. All of the UK is in a standby position, holding their breath so to speak, to wait and see what happens once the UK leaves the EU.

First the results of the referendum, followed by the triggering of Article 50, and now the unanticipated general election results. Following each of these, the pound has fallen and appears to keep falling. It is now at its lowest in over 4 years and no one is certain where it will land. Two years of negotiations will see the pound remain unstable and inflation rise to a high that has not been seen for many years. There are grumblings about a second general election and that could see the pound drop even further. The Article 50 negotiations will lead to a soft or hard exit and a soft exit could be beneficial for the pound.

All of this uncertainty and turmoil is making the exchange of the pound to another currency unpredictable and difficult for Brits to decide when a good time is for exchanging their money, mainly for travel as the season is upon us. Exchange your money now, before the pound falls further, or waiting and hoping that it rebounds is a difficult decision. With inflation as it stands now, people have to be very careful with their finances and ensure that they are getting the best rate possible to make their money go further.

If you don't want to think about exchange rate movements and plan a strategy, buying at today's price and simply ensuring you find the best rate on offer is one option. Keep in mind that the best rates will not be found at a bank or Post Office, and the worst place to exchange your money is at transport hubs such as airports. It is often the small, highly localised suppliers who have the best rates. Planning ahead can also save you money by ordering ahead of time, most exchange businesses will give you a good deal and, depending on the amount you want to exchange, will charge you lower fees.

Another option is to buy in stages. This will even out the rate as the pound fluctuates and you purchase at times when it is high and sometimes it could be low. This option won´t give you the best rate but it will prevent you from purchasing money during a temporary slump. Be aware that some fees are higher for smaller amounts and it would be wise to research these fees before opting to buy in stages.

The bottom line to purchasing currency is to do your research and make a plan. You want to ensure that you are getting the best rates and lowest fees for exchanging your money. After all, you´re going on vacation and the last thing you want to be thinking while on vacation is money and how, in hindsight, you should have done it differently.

It can be a tricky act to transfer money, especially large amounts of money. Fees are the biggest hurdle you have to overcome if you don’t want to throw money away. With the ‘global village’ that we live in, transferring sums of money is becoming more commonplace. The transfers are also becoming a lucrative business for banks and institutions. Ill-informed clients are some of their biggest gains. Don’t get caught up in that trap.

While using banks might be the first source people think of when preparing to transfer money, they may also be the most expensive. On top of the fees you have to pay to the bank for a wire transfer, there may also be hidden fees. These fees often are in the form of skewed currency exchange rates.

Some things to pay attention to are the bank’s exchange rates and their currency conversion fees. Every bank has its own exchange rate fee or currency conversion fee and these fees can be quite high. It’s up to the bank to decide these fees. Usually set as a percentage of the amount being converted and transferred, one must keep in mind that it doesn’t cost the bank more to transfer a large amount compared to a small amount. In other words, by using a percentage instead of a set fee, banks are reaping in profits based, basically, on a random number.

Exchange rates do not change with the size of a transfer, nor does the work involved. Using a percentage rate is just not fair to you. Keep this in mind as you consider what institution you will transfer your money through. Ask the questions and shop around for the best rates.

There are a number of companies opening up that provide a lower rate, compared to banks. As the number of these businesses increase, the tables are being turned in favour of you, the client. Competitive rates are great for people who need to transfer money frequently. These new businesses recognize a niche the banks have created and are taking advantage of new and expanding ways to transfer money globally.

Now is the time for those of us who need to make money transfers, whether they be small, recurring transfers or a large money transfer, such as for a house purchase, to be in control of how much they are willing to pay for that transfer. Its no longer just banks in the game.

Technology creeps into our lives, transforming who we conduct our lives, our businesses, even our interactions with family and friends. Our mobiles have become a lifeline, at times, for reaching out and seeing the face, and hearing the voice, of a loved one who is thousands of miles away. What a joy this technology is. On less emotional terms, the technology on our mobiles can make our everyday lives easier. We can send a few pounds to a friend in need, pay our bills, as well as transfer our money from and to different accounts. All the while having a cup of coffee at your favourite cafe on the corner, watching the world go by.

Ah, live is good. Now imagine that you have loved ones living in another country. A country that is not as rich in resources and opportunities as in the UK. Loved ones who count on you to send them money, on a regular basis, so that they may live a slightly better life. Now technology just got a lot more exciting and helpful. It has become a vital lifeline for many families of migrant workers in the UK.

For many years, money transfers to another country was a day long affair. Going off to the bank or brick and mortar shopfront that caters to money transfers. The paperwork and the information needed to make that transfer happen was astounding compared to what we have in the way of software and technology. We can’t forget the costs either. The bank fees and currency exchange fees – it was expensive.

For customers who need to send money out of the country, advances in mobile technology is helping to make the transfers easier and less expensive. Customers now have more choice. Using a smartphone, with just a few swipes, their money can be sent. The mechanics of money transferring is becoming more convenient and secure. It is also driving down the costs, which is of great benefit to all, especially migrant workers who want to send as much money as they can to their families while still being able to live and work in the UK.

Money transfers, according to the World Bank, is a vital lifeline for many and is worth almost $500 billion annually. There are approximately 700 million people globally who are supported by money transfers. Incredible numbers to think about. We are truly a global village and technology is making the art of reaching out easier.

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