12th Feb 2007 07:02
Vodafone Group Plc12 February 2007 12 February 2007 VODAFONE AND CITIGROUP ANNOUNCE WORLDWIDE MOBILE FINANCIAL REMITTANCE VENTURE Vodafone and Citigroup Corporate and Investment Banking's Global TransactionServices business today announce their plan to launch a Vodafone-brandedmobile-based international money transfer service targeting the globalremittance market worldwide. The new service will provide senders and receiversof money with a superior method for sending money home that is convenient,cost-effective, secure, transparent, and easy to use. This initiative couples Vodafone's global reach, brand recognition andoperational mobile money transfer service with Citigroup's worldwide network,unrivalled international payments capabilities and existing global remittancesolution. It builds upon Vodafone's recent successful pilot of the M-PESA mobilemoney transfer service by its affiliate in Kenya, Safaricom. It is anticipated that Vodafone customers in the United Kingdom will have thefirst opportunity to use the service to send money to Kenya on a trial basis andboth parties plan to launch commercially, with a focus on Eastern European andAsian markets, such as Poland and India, in the near future. Uniquely, the product being developed will allow the remitter and thebeneficiary to choose from a range of options as to how the money is sent andreceived. The sender can initiate the transfer using either a mobile phone or asecure Internet website to give instructions on where to send the funds. Thefunds will be able to be received in a bank or through the receiver's mobilephone in the form of a voucher and secure PIN that will enable the receiver toredeem the cash at a wide range of outlets, typically the airtime distributionpoints operated by the in-country mobile network service provider. For theselatter services, the beneficiary of funds does not need to have a bank account,will have a wide range of locations to collect the funds and only has to be inthe possession of a mobile phone that can receive an SMS on any mobile network. Enabling money to be transferred internationally from person to person usingmobile technology is set to greatly assist the flow of funds from migrantworkers back to their families. Migrant remittance is an important source ofincome in many developing countries - indeed the United Nations estimates thatit involves some 191 million migrants and the World Bank estimates it has atotal annual worldwide value of USD268 billion. For some individual recipientcountries remittances can be as high as a third of GDP. Alan Harper, Director for Group Strategy and New Business, at Vodafone said:"This agreement with Citigroup has the potential to create a step change inglobal remittance services and one in which the mobile service provider plays acentral role. Vodafone's international brand recognition and our successfultrial of M-PESA in Kenya combined with Citigroup's global remittance service andinternational financial reach, enables us to offer an extremely competitiveproduct compared to conventional remittance solutions available today." Michael Joseph, CEO of Safaricom in Kenya said: "Safaricom and Vodafone's M-PESAmobile money transfer service is an example of Africa leading the world in theadvancement of mobile technology and its uses. In Kenya, we have been testingthe response to mobile-based payments services and we believe that there is agreat deal to be gained for the consumer as well as for mobile and financialsector companies. This opportunity with Vodafone and Citigroup to extend theoffering to support international remittances can benefit not only Kenyans, butalso the greater population of migrant workers across the world." Francesco Vanni d'Archirafi, Region Head of Citigroup Global TransactionServices for Europe, Middle East and Africa and Chairman of Citibank Europe plc,said: "The combination of Vodafone's international mobile network andCitigroup's global footprint will create a solution that will benefitcommunities that use money transfer services worldwide. We are proud to be usingour global distribution network and cross-border payment capabilities to providemigrant workers with a cheaper and more secure way of sending money." - ends - For further information: For Vodafone Group Investor Relations Media RelationsTel: +44 (0) 1635 664447 Tel: +44 (0) 1635 664444 For Citigroup: Jeanette Volpi, Media RelationsTel: + 44 (0) 207 986 2809Email: [email protected] About Vodafone Vodafone is the world's leading international mobile telecommunications groupwith equity interests in 25 countries across 5 continents as at 31 December2006, as well as 35 partner networks. Vodafone announced it had over 200million proportionate customers worldwide at the end of January 2007. Forfurther information, please visit www.vodafone.com About Citigroup Corporate and Investment Banking Citigroup Corporate and Investment Banking is the most complete financialpartner to corporations, financial institutions, institutional investors andgovernments in the world. As a global leader in banking, capital markets, andtransaction services, with a presence in many countries dating back more than100 years, Citigroup Corporate and Investment Banking enables clients to achievetheir strategic financial objectives by providing them with cutting-edge ideas,best-in-class products and solutions, and unparalleled access to capital andliquidity. About Citigroup Citigroup (NYSE: C), the leading global financial services company has some 200million customer accounts and does business in more than 100 countries,providing consumers, corporations, governments and institutions with a broadrange of financial products and services, including consumer banking and credit,corporate and investment banking, securities brokerage, and wealth management.Major brand names under Citigroup's trademark red umbrella include Citibank,CitiFinancial, Primerica, Smith Barney and Banamex. Additional information maybe found at www.citigroup.com About Safaricom SAFARICOM LTD is the leading provider of communications services in Kenya,offering cellular network access and business solutions. SAFARICOM LTD wasformed in 1997 and in May 2000, Vodafone group Plc acquired a stake andmanagement responsibility for the company. The Company has since emerged as oneof the fastest growing companies in Kenya. The Company is still aggressivelyexpanding the market network throughout the country and developing strategicbusiness relationships with leading global telecommunication players which helpin ensuring that Safaricom has access to the world's latest technology tomaintain its market leadership. About M-PESA Vodafone's M-PESA, a mobile financial remittance product which allows users tosend credit, which can be redeemed as cash at specified outlets, is alreadyoperational in Kenya, and Vodafone is currently beginning a cross-border trialbetween the UK and Kenya. In addition, the M-PESA product is also being trialledin Afghanistan. M-PESA was initially developed using part funding from the UKGovernment Department for International Development (DFID) under the FinancialDeepening Challenge Fund Initiative. About the Global Remittance Industry According to the World Bank, recorded remittances sent home by migrants fromdeveloping countries are expected to reach $199 billion in 2006, up from $188billion in 2005, and more than double the level in 2001. Worldwide flows ofremittances, including those to high-income countries, are estimated to have togrown to $268 billion in 2006. In the World Bank report: "General Principles for International RemittanceServices", March 2006, the report states in the Introduction and ExecutiveSummary: "The flow of funds from migrant workers back to their families in their homecountry is an important source of income in many developing economies. Therecipients often depend on remittances to cover day-to-day living expenses, toprovide a cushion against emergencies or, in some cases, as funds for makingsmall investments. "For some individual recipient countries, remittances can be as high as a thirdof GDP. Remittances also now account for about a third of total global externalfinance; moreover, the flow of remittances seems to be significantly more stablethan that of other forms of external finance. "However, remittances can be expensive relative to the often low incomes ofmigrant workers and to the rather small amounts sent (typically no more than afew hundred dollars or its equivalent at a time). Also, it may not be easy formigrants to access remittance services if they do not speak the local languageor do not have the necessary documentation, while the relatively undevelopedfinancial infrastructure in some countries may make it difficult for recipientsto collect the remittances. In some cases, the services are unreliable,particularly concerning the time taken for the funds to be transferred." This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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