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2022

Remittance Market

Remittance Market By Application (Consumption, Savings, and Investment), Remittance Channel (Banks, Money Transfer Operator, and Others), and End User (Business and Personal): Global Opportunity Analysis and Industry Forecast, 2021-2030

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Author's: Pramod Borasi| Monica Chhabra | Vineet Kumar
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Remittance Market Outlook – 2030 

The global remittance market size was valued at $701.93 billion in 2020, and is projected to reach $1,227.22 billion by 2030, registering a CAGR of 5.7% from 2021 to 2030. Remittance is referred as sending of money by foreign migrant cross border to another person via electronic payments, drafts, and check. In addition, majority of remittance services providers are focusing on digital remittance to enhance their business and provide customer with easier and quicker transferring services. Numerous benefits of using digital channels such as high speed, availability of digital channels 24 hours a day, transparency, ease of use, high security, and others, for sending money create numerous opportunities for the remittance market.

Rise in mobile-based payment channels and cross-border transactions and decrease in remittance transfer time & cost drives the growth of the market. In addition, increase in adoption of banking & financial sectors across the globe fuels the remittance market growth. However, rise in number of financial crimes and lack of awareness for digital remittance is expected to impede the market growth. Furthermore, technological advancements in digital remittance market is expected to provide lucrative opportunities for the market growth.

Remittance Market (2021 - 2030)

By end user, the personal segment is expected to garner a significant remittance market size and is expected to witness growth at the highest rate during the forecast period, owing to money sent by the migrant labor workforce to their home country as they migrate to other countries to pursue work such as seasonal work. 

Region wise, the remittance market was dominated by Asia-Pacific in 2020 and is expected to witness growth at the highest rate owing to growing number of immigrants and increasing adoption of digital remittance owing to rapidly advancing technologies, evolving customer expectations, and a changing regulatory landscape, which are driving the automation of cross-border and remittance services. 

The report focuses on growth prospects, restraints, and trends of the remittance market. The study provides Porter’s five forces analysis to understand impact of various factors, such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers, on the remittance market share.

Remittance Market
By Application
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Consumption segment will dominate the market during the forecast period

Segment Overview

The global remittance market is segmented on the basis of application, remittance channel, end user, and region. In terms of application, the market is classified into consumption, savings and investments. By remittance channel, it is divided into banks, money transfer operator, and others. By end user, it is divided into business and personal. Region wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

Remittance Market
By Remittance Channel
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Banks segment will maintain the lead during the forecast period

Competitive Analysis

The key players profiled in the remittance market analysis are Bank of America, Citigroup Inc., JPMorgan Chase & Co., MoneyGram International Inc., RIA Financial Services Ltd., TransferWise Ltd., UAE Exchange, Wells Fargo, Western Union Holdings Inc. and XOOM. These key players have adopted various strategies, such as product portfolio expansion, mergers & acquisitions, agreements, geographical expansion, and collaborations, to increase their market penetration and strengthen their foothold in the industry.

Remittance Market
By End User
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Personal segment will generate the highest revenue during 2021 - 2030

COVID-19 Impact Analysis

As the COVID-19 pandemic spread across the globe economic crisis continues to spread, the demand for remittance industry decreased owing to decreasing amount of money migrant workers send home. In addition, it is projected to decline 14% by 2021 compared to the pre COVID-19 levels in 2019, according to the latest estimates published in the World Bank’s Migration and Development Brief. Remittance flows to low and middle-income countries (LMICs) are projected to fall by 7%, to $508 billion in 2020, followed by a further decline of 7.5%, to $470 billion in 2021. 

The foremost factors driving the decline in remittance industry include weak economic growth and employment levels in migrant-hosting countries, weak oil prices; and depreciation of the currencies of remittance-source countries against the U.S. dollar. Moreover, the declines in 2020 and 2021 will affect all regions, with the steepest drop expected in Europe and Central Asia (by 16% and 8%, respectively), followed by East Asia and the Pacific (11% and 4%), the Middle East and North Africa (8% and 8%), Sub-Saharan Africa (9% and 6%), South Asia (4% and 11%), and Latin America and the Caribbean (0.2% and 8%).

Remittance Market
By Region
2030
Asia-pacific 
North America
Europe
LAMEA

Asia-Pacific region would exhibit the highest CAGR of 6.4% during 2021 - 2030

Top Impacting Factors

Rise in Cross-Border Transactions and Mobile-Based Payment Channels

Rise in cross-border transactions and move toward mobile banking and mobile-based payment solutions dominate payment trends in Asia-Pacific, which is expected to drive the growth of the remittance market. In addition, owing to rise in international commerce, migration and changing economic trends across the globe. In addition, new developments in the world of cross-border payments is the prospect of making real-time international payments a reality. 

Furthermore, number of banks are striving to deliver timely cross-border remittances and value-added services using a relationship-centric approach, which fuel the growth of the remittance market. For instance, in September 2021, HSBC India launched HSBC UniTransact, a digital proposition aimed at simplifying cross-border transactions. The offering is a one-stop solution, bringing clients the benefit of seamless integration of all aspects of transaction banking while minimizing manual intervention through the course of the transaction journey.

Reduced Remittance Cost and Transfer Time

Cross-border payments have become insignificant in cost, quick, auditable, and accessible to everyone owing to the use of digital transfer networks such as mobile phone technology, mobile money, digital currencies, distributed ledgers, electronic identity, and others to send money. The adoption of digital remittance is expected to reduce reliance on cash agents in both sender and receiver nations, which is now contributing to the maintenance of high transaction costs.

It is also expected to alleviate many of the risks, hurdles, and costs associated with security and know-your-customer (KYC). As a result, banks and money transfer companies use digital technology to offer remittance services at considerably cheaper prices than conventional over-the-counter services, increasing digital remittance adoption in the area. 

Furthermore, the use of modern technologies and government-led public awareness initiatives significantly lower remittance costs. The usage of digital remittance is expected to increase as a result of this decrease. Transparency projects like SendMoneyPacific, for example, allow remittance senders to compare rates and learn about the advantages of new digital transfer providers. This is intended to increase consumer awareness about digital remittance market.

Key Benefits For Stakeholders     

  • The study provides an in-depth analysis of the remittance market forecast along with the current trends and future estimations to explain the imminent investment pockets.
  • Information about key drivers, restraints, & opportunities and their impact analysis on the global remittance market is provided in the report.
  • Porter’s five forces analysis illustrates the potency of the buyers and suppliers operating in the industry.
  • The quantitative analysis of the market from 2021 to 2030 is provided to determine the market potential.

Remittance Market Report Highlights

Aspects Details
Remittance Market By Application
By Application
  • Consumption
  • Savings
  • Investment
Remittance Market By Remittance Channel
By Remittance Channel
  • Banks
  • Money Transfer Operator
  • Others
Remittance Market By End User
By End User
  • Business
  • Personal
Remittance Market By Region
By Region
  • North America  (U.S., Canada)
  • Europe   (France, Germany, UK, Italy, Spain, Rest of Europe)
  • Asia-Pacific   (China, Japan, India, Philippines, Pakistan, Rest of Asia-Pacific)
  • LAMEA  (Latin America, Middle East, Africa)
Remittance Market By Key Market Players
By Key Market Players
  • Bank of America
  • Citigroup Inc.
  • JPMorgan Chase & Co.
  • MoneyGram International Inc.
  • RIA Financial Services Ltd.
  • TransferWise Ltd.
  • UAE Exchange
  • Wells Fargo
  • Western Union Holdings Inc.
  • XOOM
Key Market Players
COMPANY PROFILES: STARTUP’S

AZIMO LTD., .CWALLET, DENARII CASH, INSTAREM INDIA PVT. LTD., NOW MONEY, REMITNOW, .REMITR, SCI VENTURES, INC., SENDAH, SURECASH

Analyst Review

According to top level CXOs, the adoption of remittance services has increased over time due to migration of population to other country for job and business and evolving supportive government regulations across the globe. In addition, the penetration of digital financial services has increased in the Asia-Pacific region in the last few years, which is an important development in the process of transformation.

According to CXOs of leading companies, the remittance market is highly fragmented and competitive, owing to the presence of well-diversified remittance channels. However, continuous increase in presence of digital remittance providers makes the marketplace highly competitive.

For instance, in December 2020, Bank of America, a charter member of SWIFT Global Payments Innovation (gpi), announced the launch of a CashPro® self-service tool that allows clients to have real-time visibility into their international payments. The payments tracking tool populates SWIFT gpi information into a view that can be read easily and acted upon immediately. In addition, with enriched SWIFT gpi payment data, a client can investigate why a wire transfer may have been rejected or cancelled, in addition to identifying the source of a wire status change – all through an on-demand, online tool.

Moreover, in April 2019, Citi Treasury and Trade Solutions announced a strategic partnership with Vietnam-based intermediary payment service provider Payoo to facilitate consumer-to-business collections for corporate clients in the country. Under the partnership, Citi’s corporate clients in Vietnam will be able to receive real-time payments from their customers for services including utilities, telecommunications and credit card bills through Payoo’s extensive digital network and physical footprint of over 10,000 brick-and-mortar touchpoints. In addition, the collaboration with Payoo is exciting as it complements Citi’s capabilities to deliver last-mile digital solutions to their clients. Thus, growing number of such developments across the globe is expected to drive the growth of the market.

Author Name(s) : Pramod Borasi| Monica Chhabra | Vineet Kumar
Frequently Asked Questions?

The Remittance Market is expected to grow at a CAGR of 5.7% from 2021 to 2030.

The Remittance Market is projected to reach $1,227.22 billion by 2030.

Rise in mobile-based payment channels and cross-border transactions etc. propel the remittance market growth.

The key players profiled in the report include Bank of America, Citigroup Inc., JPMorgan Chase & Co., and many more.

On the basis of top growing big corporations, we select top 10 players.

The Remittance Market is segmented on the basis of application, remittance channel, end user, and region.

The key growth strategies of Remittance market players include product portfolio expansion, mergers & acquisitions, agreements, geographical expansion, and collaborations.

Consumption segment holds a dominant position throughout the forecast period of 2021 to 2030.

Money Transfer Operator segment would exhibit the highest CAGR of 8.1% during 2021 - 2030.

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Remittance Market

Global Opportunity Analysis and Industry Forecast, 2021-2030