BitPesa

If you are sending less than $350, then BitPesa will be your cheapest option. They charge a flat fee of 3%, regardless of how much or how little you want to send. BitPesa cuts out international banks by using Bitcoin. This has enabled them to keep their prices low, but it also increases the financial risk of using them.

You can not send fiat currency with BitPesa, you can only send Bitcoin. If you don't already own Bitcoin, then you need to buy some. Buying Bitcoin is simple enough, you can do so at any exchange, but it does add an extra layer of fees. We looked at Bitstamp, who charge a fee of 0.5% to buy Bitcoin, so our cost of transferring is now 3.5%.

Sending a precise amount of Kenyan Schillings also becomes problematic. You have to first figure out how much Bitcoin you need, then pray that the value of Bitcoin doesn't fluctuate wildly before you complete the transfer. BitPesa themselves acknowledge this risk, and their website quotes:

the price or value of Bitcoin can change rapidly, decrease, and potentially even fall to zero. Upon your confirmation of an Exchange Transaction, during the Transaction Period, we will honor the Exchange Rate quoted for the Exchange Transaction. However, we are not responsible for, and you agree to hold us harmless against, fluctuations in the Exchange Rate while Bitcoin is in your BitPesa Account or while a transfer of Bitcoin to or from your BitPesa Account is pending

BitPesa is a great option for small transfers, specially if you don't mind taking on some exchange rate risk. It will be particularly appealing to people who are familiar with Bitcoin, and already hold the cryptocurrency.

If you live in an area where Bitcoin is restricted, then you will not have access to BitPesa

WorldRemit

WorldRemit is available for senders in 50 countries, who can transfer funds to 110 destinations worldwide, so this service is in no way limited to Kenya.

If you are sending more than $350, then WorldRemit will be your cheapest option. On top of this, they offer guaranteed exchange rates, and the convenience and safety of being able to transact with normal fiat money. Dealing with fiat money rather than Bitcoin, may be more expensive for smaller transfers, but for the extra cost, you are removing the financial risk.

Accel Partners are strong believers in the future of WorldRemit, and have invested $40 Million in the company. Accel have a reputation for identifying quality online investments and were early investors in Facebook, Spotify, and Dropbox.

Western Union

Established in 1851, Western Union has been offering money transfer services since 1871. They haven't just been doing this since before the internet, they were transferring funds 5 years before the telephone! In 1884, Western Union was one of the 11 stocks included in the original Dow Jones Industrial Average.

At the age of 164 the company is still a technological leader in the financial services industry. Western Union offers a wide array of services including pre paid cards. Western Union has over 500,000 locations around the world and more than 100,000 ATMs.

Western Union is the most expensive of the options we looked at. They are a full service option for those who want more than a simple transfer. They also have the advantage of being an established brand with a well recognized name. Consumers are more likely to trust the 164 year old Western Union, than a recent internet start up they have only just heard of.

We expect that Western Union will continue to be an innovative force in the money transfer industry and we look forward to seeing how their services continue to evolve. If there is a future for cryptocurrencies, we are sure Western Union will be a part of it. They might even have their own alt coin!