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Remittance Market Size, Share, Growth and Trend Forecast | Report 2032

Remittance Market Outlook

According to the report by Expert Market Research (EMR), the global remittance market size reached approximately USD 607.43 billion in 2023. Aided by the shift towards digitalisation and technological innovations, the market is projected to grow at a CAGR of 4% between 2024 and 2032.

Remittance refers to the transfer of money, typically by a foreign worker, to an individual in their home country. This financial transaction is an essential source of income for many households worldwide and plays a significant role in the economy of developing countries.

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The global remittance market has seen remarkable growth and transformation over recent years, driven by a combination of technological advancements, regulatory changes, and evolving consumer preferences. Remittances, which involve the transfer of money by foreign workers to their home countries, play a crucial role in the global economy, particularly for developing nations where they constitute a significant portion of GDP.

Some of the most significant remittance market trends are the shift towards digitalisation and technological innovations. Traditional remittance methods, such as bank transfers and money orders, are increasingly being replaced by digital platforms and mobile money services. The proliferation of smartphones and internet connectivity has enabled the rise of digital wallets, online money transfer services, and mobile payment apps, which offer greater convenience, speed, and security. Companies like PayPal, TransferWise (now Wise), and Western Union have developed robust digital platforms that allow users to transfer money across borders with ease. Additionally, blockchain technology and cryptocurrencies are beginning to make inroads into the market, promising lower fees and faster transactions by eliminating intermediaries.

The global remittance market has traditionally been criticised for high transfer fees, which can significantly reduce the amount of money received by beneficiaries. However, increased competition among remittance service providers, along with regulatory pressure, has led to a gradual decline in transfer costs. Digital-first companies, such as Revolut and Remitly, have disrupted the market by offering lower fees and transparent pricing structures compared to traditional money transfer operators and banks. This competition has forced established players to innovate and reduce their fees to retain the remittance market share. The World Bank’s initiatives and targets to reduce remittance costs to below 3% of the transferred amount have further incentivised cost reduction across the industry.

Regulatory changes and increased scrutiny around anti-money laundering (AML) and combating the financing of terrorism (CFT) have also significantly impacted the remittance market. Governments and regulatory bodies worldwide are implementing stricter compliance requirements to ensure the transparency and legality of cross-border transactions. Remittance service providers must now adhere to rigorous Know Your Customer (KYC) and AML standards, which involve verifying the identities of senders and receivers and monitoring transactions for suspicious activities. While these measures enhance the security and integrity of remittance flows, they also pose challenges for providers, particularly smaller players, in terms of compliance costs and operational complexities.

Economic factors and migration trends play a crucial role in shaping the remittance market dynamics. The global economic environment, including factors such as employment opportunities, wage levels, and inflation rates in host countries, directly influences the volume of remittances sent by migrant workers. Periods of economic prosperity in host countries typically lead to higher remittance flows, while economic downturns can result in a decline. Moreover, migration patterns and policies significantly affect the market. Countries with large migrant populations, such as the United States, Saudi Arabia, and the United Arab Emirates, are major sources of remittances. Changes in immigration policies, visa regulations, and labour market conditions in these countries can have substantial impacts on remittance volumes.

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Another notable remittance market trend is the increasing integration of remittance services with other financial products and services. Many remittance service providers are expanding their offerings to include additional financial services, such as savings accounts, insurance, and micro-loans, tailored to the needs of migrant workers and their families. This integration enhances financial inclusion by providing unbanked and underbanked populations with access to a broader range of financial tools. Mobile money services, in particular, have been instrumental in this regard, enabling users to save, borrow, and insure through their mobile devices. Companies like M-Pesa in Kenya have demonstrated the potential of such integrated financial ecosystems.

The COVID-19 pandemic has had a profound impact on the global remittance market. Initially, there were concerns that remittance flows would plummet due to job losses and economic uncertainties faced by migrant workers. While some regions did experience a decline, overall remittance flows proved more resilient than anticipated. The pandemic accelerated the adoption of digital remittance channels as physical locations faced restrictions and closures. This shift to digital channels is likely to have a lasting effect, as users become accustomed to the convenience and efficiency of online and mobile transfers. Additionally, remittances have played a vital role in supporting households in recipient countries during the economic hardships caused by the pandemic.

Market Segmentation

The global remittance market can be divided based on type, remittance channel, application, end user, and region.

Market Breakup by Type

  • Inward Remittance
  • Outward Remittance

Market Breakup by Remittance Channel

  • Banks
  • Money Transfer Operators
  • Others

Market Breakup by Application

  • Consumption
  • Savings
  • Investment

Market Breakup by End User

  • Business
  • Personal

Market Breakup by Region

  • North America
  • Europe
  • Asia Pacific
  • Latin America
  • Middle East and Africa

Competitive Landscape

The EMR report looks into the market shares, plant turnarounds, capacities, investments, and mergers and acquisitions, among other major developments, of the leading companies operating in the global remittance market. Some of the major players explored in the report by Expert Market Research are as follows:

  • Bank of America Corporation
  • Citigroup Inc.
  • P. Morgan Chase & Co.
  • Ria Financial Services Ltd
  • Western Union Holdings, Inc.
  • MoneyGram International, Inc.
  • TransferWise Ltd.
  • Others

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