The 2018 statistics of the World Bank depicts that the global remittance market is $626.1 billion large.
With industries going global, there has been a massive expansion in opportunities across borders. People take advantage of these opportunities and move outside their countries to work. The number of such migrants is significant, leading to billions of dollars being sent back home as remittances.
Earlier, the cross-border remittance industry was entirely handled through the retail network. Unavailability of banking services, as well as high-interest rates, levied on international transfers were few of the primary reasons for the remitted amount being transferred through retail network. In the last two decades, digital remittance operators have entered the market. The remittances were then being sent through a swift channel which not only reduced the payment fee but also offered ease of usability.
With easy-to-use mobile applications, these operators have eliminated the need for long-form filling processes, agent fees, and transfer codes. The growth in technology and automation has driven the rise in the digital remittance market. Cumulatively, this has resulted in the advancement of financial services.
With the introduction of regulatory initiatives like PSD2, which are encouraging banks and financial institutions to become more transparent as well as nurture a rich ecosystem of data. The transparency and data sharing would help operators to develop varied services and support the growth of digital remittance payments.
The exponential rise in the internet usage has led to a massive advancement in the availability of financial services. However, there is still a lack of guidance and awareness that is restraining people from taking benefits from the digital remittance transfer.