In 2017, some of the top remittance receivers included the Philippines and Nigeria, countries where 72% and 56% of the adult population respectively are unbanked and as such their economies remain predominantly cash-based.Ĭlearly, for recipients in these countries, money in a bank account is often meaningless. Meanwhile, people will still need to find ways to receive and access the money their relatives send from overseas. This has led to legislative initiatives as well as the setting of ambitious targets for achieving universal financial inclusion.īut as important as it is to improve access to the financial system for everyone, it isn’t a quick fix. In the last few years, there’s been a huge push for financial inclusion on an international scale. Compliance with government regulations, clearing procedures, and other factors mean a recipient can expect to wait five working days or even more before the money reaches their bank account.Īnd of course, our discussion so far has been based on the assumption that both sender and recipient have access to a bank account. In addition to the woes of cost, the process itself can be excruciatingly slow. These costs don’t account for exchange rates, which can leave even less money in recipients’ pockets by being unfavourable, or having a commission built in. Similarly, sending US$200 to a country in East Asia or Asia Pacific can rack up 8.33% in fees, or approximately US$16.50. It typically costs around US$19.50 to send US$200 to a country in sub-Saharan Africa - an average of 9.72% in fees. But the truth is that expats often hit roadblocks we might not even have thought of.įor starters, while costs have decreased in recent years, remitting money to a developing country can still be eye-wateringly expensive. Those that have not worked overseas can be forgiven for assuming that sending money cross-border to help your family would be easy and straightforward in 2018. The surprising challenges of remitting money in the digital age The majority of this value is sent to developing countries, and for many on the receiving end, the money is a lifeline. It was worth US$582.4bn in 2016, when the World Bank projected 3% to 4% year-on-year growth in 20. Migration is continuing to increase and will do so for the foreseeable future, meaning that money remittance is a growing industry. As The Migration Observatory puts it, remittances are “the most concrete consequence of international migration.” There are numerous reasons why people do this, but one clear characteristic most expats have in common is that they will want to send money back home at some point. The service, which we provide through our Skrill digital wallet, is designed to help expats send money to their families from overseas more securely, more efficiently, and at a lower cost.Īccording to the World Bank, over 250 million people - or 3.4% of the world’s population - currently live and work abroad. An example is the huge difference digital wallets can make to people’s lives when it comes to money remittance.įor this reason, we recently launched Skrill Send Direct. However, digital wallets have a lot more to offer than just being a more convenient substitute for cash. And how they eliminate friction points such as the need to input credit card details or a PIN to complete a purchase. We talk about how they might be faster and more convenient than paying in cash. The conversations focused on the benefits of digital wallets are often centred on consumers.
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