"From Senegal to Somalia and Egypt to South Africa, credit alert notifications from fintech apps such as Western Union or WorldRemit often set the mood for the rest of the day, week or even month. Transfers from workers within the continent and the diaspora to their relatives are often referred to as the black tax, whereby one person's salary and relative success can become the safety net for a whole extended family."
"For those sending money, the payments are both a burden and badge of pride. In Nigeria's economic engine, Lagos, salaried workers surveyed last year said that an average of 20% of their monthly wages went to supporting relatives. In South Africa, where unemployment is above 42%, one wage supports almost four people, according to Pietermaritzburg Economic Justice & Dignity Group, a research and campaign organisation. Research in Kenya found that the pressure to give money to family members made entrepreneurs limit the growth of their businesses."
Across African countries, remittance notifications from fintech apps shape recipients' moods and financial stability. Transfers from workers within the continent and the diaspora often function as the 'black tax', where one person's salary becomes a safety net for extended family. Senders experience payments as both burdens and badges of pride. In Lagos, surveyed salaried workers reported sending about 20% of monthly wages to relatives. In South Africa, unemployment above 42% means one wage supports almost four people. Research in Kenya found that family financial pressure constrains entrepreneurs' business growth. Remittances totaled $100bn in 2022, exceeding aid and foreign investment.
Read at www.theguardian.com
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