Migration, whether across borders or within a country, profoundly affects individuals and families, often leading to better economic opportunities and improved well-being. International migration generally offers more significant benefits than internal migration, particularly in developing regions like Africa, where challenges such as poverty, high unemployment, ethnic and religious conflicts, refugee crises, and rapid urbanization are prevalent.
Africa has a long tradition of migration, shaped by societal needs, economic opportunities, and urgent circumstances. This movement, which can be voluntary or forced, includes aspirations for better jobs, education, and living standards or escapes from conflicts and disasters. For those who move abroad, the connection with home often remains strong, with remittances serving as a critical link between diaspora communities and their families.
What Exactly Is Remittance?
Remittances refer to funds sent home by migrants to support their families, communities, or other causes. These can take the form of cash or goods and represent a vital source of foreign income for many developing economies.
According to the International Monetary Fund (IMF), remittance flows have grown significantly in recent years, becoming one of the largest sources of foreign income for several developing countries.
The United Nations Department of Economic and Social Affairs (UNDESA) estimates that 40.4 million Africans live outside their countries of origin, with migration increasing by 2.6% annually over the past five years.
Countries like Egypt, Morocco, and Nigeria are among the largest sources of migrants, while nations such as South Sudan, the Gambia, and Cameroon are experiencing rapid growth in migration rates. These movements underscore the critical role remittances play in sustaining households and fueling local economies in Africa.
Africa’s Growing Share of Global Remittance Flows
In 2023, remittances from the global diaspora continued to flow in massive amounts, providing crucial financial support to families and communities back home.
Among the top 10 recipients, India, the largest beneficiary of migrant funds, led the pack with $119.53 billion in remittances; Mexico followed with $66.24 billion; China ranked third with $50 billion; and the Philippines, a country known for its large overseas worker population, occupied the fourth position with $39.10 billion.
France settled at the fifth spot with $36.91 billion, Pakistan ranked sixth with $26.56 billion, and Bangladesh was next after receiving $22.17 billion.
Germany came in eighth position with $20.43 billion, followed by Guatemala, which saw a notable $19.98 billion, while Nigeria, with $19.55 billion, rounded out the top 10.
These figures not only represent the financial transfers made by individuals but also tell the story of global interconnectedness, where millions of people work abroad to send funds back to their home countries, making a profound impact on their countries’ economies and the livelihoods of their families.
Nigeria’s Decade of Diaspora Remittances: Trends and Insights
Over the past decade, diaspora remittances have played a vital role in sustaining Nigeria’s economy, although the flow has been marked by fluctuations reflecting global and domestic economic dynamics.
Between 2014 and 2019, remittances steadily grew, reaching a high of $24.31 billion in 2018 before declining slightly to $23.81 billion in 2019. A significant drop occurred in 2016, with remittances falling to $16.93 billion, coinciding with Nigeria’s economic recession and global oil price challenges.
The COVID-19 pandemic further disrupted inflows, with remittances dropping to $17.21 billion in 2020. However, recovery followed, with figures rebounding to $20.13 billion by 2022. Despite this progress, a slight decline was observed in 2023, with remittances totalling $19.55 billion.
These figures highlight the enduring importance of remittances in Nigeria’s economy while showcasing the sector’s sensitivity to broader economic trends. Even with these challenges, Nigeria remains one of the top global recipients of diaspora remittances.
A significant opportunity for organizations like Kwanda, which has been utilizing diaspora remittances to foster tangible transformation across African countries.
A New Approach to Remittance
Diaspora Africa’s core roles in African migration research and storytelling have stretched into understanding the missions of grassroots projects on the continent, where migrant communities are stepping up beyond cash transfers to real-time support. By highlighting these positions, Diaspora Africa acknowledges the emergence of new approaches that encourage open and strategic remittance.
Jermaine Craig, the founder of Kwanda, a funding platform that connects members of the African diaspora based in the United Kingdom (UK) and North America with grassroots projects in Africa, said the platform offers unique value, such as enabling Africans outside the continent to support community projects directly.
Kwanda aims to optimize the impact of remittances while addressing the changing needs of diaspora communities. By offering a platform for collective, philanthropic contributions, Kwanda makes it easier for people to support grassroots efforts in Africa without the complexity of traditional investments.
Jermaine highlights the importance of maintaining remittance flows amid generational shifts in diaspora communities.
“A lot of Africans in the diaspora, particularly second or third generations, lack the direct connection to their home countries that their parents had,” he explains.
Kwanda’s model ensures that remittances remain a lifeline while optimizing their impact. By offering an accessible platform for small, philanthropic contributions, Kwanda appeals to those who want to give back without the need for complex decision-making or significant financial commitments.
From Remittances to Results
Since its inception, Kwanda has deployed projects in 12 African countries, including Nigeria, Ghana, Kenya, Zimbabwe, and Uganda, as well as some Caribbean nations. The platform’s focus spans three primary sectors—health, education, and agriculture—while also supporting marginalized communities and infrastructure development.
One of Kwanda’s innovative approaches is creating locally maintainable clean water wells in Tanzania. However, challenges such as inflation and currency devaluation have impacted project costs.
“In Tanzania, the price of building wells doubled due to inflation, making it infeasible,” Jermaine said.
Kwanda addresses these hurdles by operating in stable currencies like pounds and dollars, ensuring flexibility to adapt to fluctuating economic conditions.
After its initial launch in 2020, the platform experienced its largest remittance flows in the company’s second year. However, in that same year, Kwanda paused operations to re-strategise and improve its services to Africans in the diaspora and African communities.
Since reopening in early 2024, Kwanda has processed approximately $20,000 in remittances, with projections to reach $80,000 in 2025 and even higher in subsequent years.
This growth is driven by Kwanda’s steady membership scaling and predictable contribution flows, providing a reliable mechanism for sustaining and expanding diaspora-driven impact across Africa.
The Bigger Picture
At its core, Kwanda exists to address a dual challenge: sustaining the flow of remittances into Africa and making those contributions more effective. Unlike traditional investment-focused platforms, Kwanda caters to individuals who prefer philanthropic contributions, offering a lightweight option to contribute to meaningful change.
“Our goal is to capture people who want to contribute without the complexity of investment analysis,” says Jermaine.
By streamlining the process, Kwanda ensures that anyone can participate in uplifting African communities, no matter the size of their contribution.
Conclusion
As remittance flows continue to be a critical driver of economic and social development in Africa, platforms like Kwanda provide a transformative approach to diaspora giving. By bridging generational gaps, addressing economic challenges, and focusing on impactful projects, Kwanda demonstrates the immense potential of remittances to sustain and develop African communities.
Through its innovative model, Kwanda is not just a platform for sending money; it is a movement for creating lasting change.
Writer: Victor Ejechi
Editors: Chimee Adioha, Amaka Obioji