Pesa expands cross-border payments to Australia, targeting diaspora remittances

Pesa, a Nigerian fintech specialising in cross-border payments, has expanded its consumer money-transfer service to Australia. The move enables dual-directional transactions between Australia and Nigeria, as well as other countries, targeting the African diaspora with fee-free transfers.

Expansion into Australia

Pesa, a Nigerian cross-border payments fintech, has launched its consumer money-transfer service in Australia, enabling dual-directional transactions between Australia and Nigeria. The service also supports transfers to and from other countries, including the Philippines, India, Europe, the United Kingdom, the United States, and Canada.

The expansion targets the African diaspora, particularly Nigeria-born residents in Australia, which numbered over 12,000 according to the 2021 Australian Census. Australia sent approximately $25 billion in remittances abroad in 2024, highlighting the market’s potential for specialised fintech solutions.

According to TechCabal, Pesa’s move aims to address gaps left by traditional remittance providers, which often impose high costs and delays. The World Bank reported that the average cost of sending remittances to Sub-Saharan Africa was 8.37% in Q2 2024, the highest regional average globally.

Operational and Regulatory Model

Pesa operates under authorisation from the Australian Transaction Reports and Analysis Centre (AUSTRAC), enabling it to facilitate cross-border transactions directly. The company holds liquidity in Nigeria to pay recipients without relying on correspondent banks, reducing delays and operational complexities.

Unlike traditional remittance services, Pesa does not charge transaction fees. Instead, it generates revenue from the foreign exchange spread, taking on liquidity and currency risk to maintain pricing stability for customers. This model aligns with its goal of offering cost-effective transfers for migrant communities.

The expansion follows Pesa’s earlier move in March to open its payment infrastructure to businesses and fintechs, suggesting a broader strategy to diversify its revenue streams beyond consumer remittances.

Background and Future Plans

Pesa was originally founded as PesaPeer in 2021 and rebranded to Pesa in 2023. The company focuses on reducing costs and inefficiencies in cross-border payments, particularly for African diaspora communities.

While Pesa has not disclosed its next target markets, it is reportedly considering additional corridors for future expansion.

What this means

Lazyfounder analysis — our interpretation, not reported fact.

Pesa’s expansion into Australia reflects a strategic push to capture a niche but growing segment of the remittance market: African diaspora communities underserved by traditional players. By eliminating transaction fees and leveraging direct liquidity, Pesa is betting on volume and customer loyalty to offset the risks of holding foreign exchange positions. This approach mirrors a broader trend in fintech, where startups are prioritising speed and cost efficiency over opaque fee structures.

For founders, Pesa’s model highlights the importance of regulatory agility—securing AUSTRAC authorisation was likely a critical enabler—and the potential of diaspora corridors as scalable entry points into larger markets. However, the long-term challenge will be sustaining margins in a sector where competitors like Wise and Remitly have already optimised for scale. If Pesa can replicate this model in other high-remittance corridors, it could disrupt not just consumer transfers but also B2B cross-border payments.

Key takeaways

• Pesa now enables dual-directional money transfers between Australia and Nigeria, as well as other countries.
• The service targets the African diaspora, a segment often overlooked by traditional remittance providers.
• Pesa operates under AUSTRAC authorisation and avoids correspondent bank delays by holding liquidity in Nigeria.
• The company generates revenue from foreign exchange spreads, not transaction fees.
• This expansion follows Pesa’s move in March to open its payment infrastructure to businesses and fintechs.

FAQ

Why is Pesa expanding to Australia?

Pesa is targeting the African diaspora, particularly Nigeria-born residents in Australia, to address high remittance costs and delays associated with traditional providers. Australia’s $25 billion remittance market presents a significant opportunity for specialised fintech solutions.

How does Pesa’s model differ from traditional remittance services?

Pesa avoids transaction fees and generates revenue from foreign exchange spreads. It also holds liquidity in Nigeria to bypass correspondent banks, reducing delays and costs for customers.

What regulatory approval does Pesa have in Australia?

Pesa operates under authorisation from the Australian Transaction Reports and Analysis Centre (AUSTRAC), which allows it to facilitate cross-border transactions in compliance with local regulations.

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