With time, terms and fees posing as common hurdles for remittance services, many are turning to the abilities of open banking to streamline their services; and the fintech firm Lemonade Finance is no exception.
Founded in 2020, the firm exists to serve the African diaspora, with a focus on enabling Nigerians, Ghanaians and Kenyans in the UK to send money back to friends and family.
“Money transfer companies have largely ignored the personal remittance needs of Africans living abroad, so we founded Lemonade Finance to make sending money home as easy as possible,” explains Afeez Gbotosho, head of product at Lemonade Finance.
“Ensuring we provide a secure, fast and cost-efficient way for Africans in the UK to send funds through the platform then led us to examine how to integrate instant payments through open banking.”
Remittances to Africa have traditionally been compromised by three significant issues: long transaction times, restrictions in terms of use and higher than average fees. As a result, platforms for international remittances are either unavailable to Africans or limited in their functionality.
Recognising the opportunity to overcome these problems and better serve its customers, Lemonade Finance has announced its collaboration and implementation of TrueLayer’s open banking platform.
The integration will allow Lemonade Finance’s customers to connect their bank accounts to its platform, enabling the firm to manage risk more effectively by verifying the account and confirming the payee’s details.
Customers can then instantly send funds directly from their bank to Lemonade Finance, using TrueLayer’s account-to-account payments, removing the need to manually enter card details or share their bank credentials.
With higher conversions and fewer failed transactions, customers gain additional peace of mind that their recipient will receive the funds in minutes with Lemonade Finance compared to up to four days using other remittance methods.
“With TrueLayer we are delivering a more efficient way for our customers to send money,” continues Gbotosho. “With just a few clicks they can fund their account and get confirmation the payment has been made. Thanks to the intuitive user experience, we have already seen many of our customers use open banking and benefit from instant payments to send money back home.”
Nick Tucker, head of financial service at TrueLayer, added: “Open banking with TrueLayer and remittances are a perfect match – they’re instant, secure and more cost-effective compared to cards, digital wallets and manual bank transfers.
“For years, people haven’t been getting the service they deserve from traditional remittance, paying more than they should on transfers that still take days to arrive. That’s why we’re proud to be working with an innovator like Lemonade Finance who are challenging the status quo and using our technology to make remittances to Nigeria, Kenya and Ghana as easy as possible.”
