Nigeria received close to $20 billion in remittances in 2024, contributing to Africa's nearly $100 billion inflow. Globally, remittance flows reached approximately $905 billion, with $685 billion directed at low and middle-income countries. These figures, however, represent only a portion of the total activity.

A significant share of remittance activity occurs informally through peer-to-peer arrangements. Individuals abroad with funds to send home connect with those needing foreign currency locally, settling transactions without money physically crossing borders.

This peer-to-peer model functions more like a marketplace, optimizing through network effects as more participants join and corridors open. This is distinct from traditional pipeline models where intermediaries extract margins at each stage.

For Nigeria, where remittances often rival foreign direct investment, this informal market is crucial. Traditional channels for sending money to Africa typically incur costs between 6 and 8 percent. Peer-to-peer models foster competition, reducing these margins and retaining more value within household economies.

While historically difficult to track, advances in digital identity, real-time payment rails, and compliance tooling are enabling greater structure and oversight for these transactions, preserving their efficiency.