Money Travels: 2024 Digital Remittances Adoption Report
Global Visa research highlights the crucial role of cross-border money movement in supporting humanitarian efforts, as consumers see the future as digital.
Introduction
Remittances are a crucial financial lifeline for millions of migrant workers and their families worldwide. Visa’s latest research, encapsulated in the “Money Travels: 2024 Digital Remittances Adoption” report, underscores the importance of digital remittances in supporting humanitarian efforts. This comprehensive study reveals that many remittance senders prioritize supporting lives in need amidst global crises.
Key Findings of the Report
Visa’s research, conducted with nearly 45,000 remittance senders and receivers across twenty countries, emphasizes the growing importance of fast, easy, and secure payments for families, communities, and economies worldwide. Despite a decline in global remittances due to economic challenges, the report highlights a positive outlook for future remittances, driven by the resilience of migrant workers.
Digital vs. Physical Remittances
The study reveals a marked preference for digital applications for sending money across borders. More than two-thirds of remittance users favor digital methods, with 43% reporting no issues when sending or receiving digital remittances. In contrast, 76-77% of users encountered problems with physical remittances, such as cash, checks, and money orders.
Digital remittances offer several advantages over traditional methods. They provide a level of convenience that physical remittances cannot match. For instance, digital platforms eliminate the need for physical travel to a remittance center, which can be time-consuming and costly. Additionally, digital remittances offer enhanced security features that protect users from fraud and theft. For example, many digital remittance services employ encryption and other security protocols to ensure that transactions are secure. This level of security is often not available with traditional remittance methods, which can expose users to risks such as lost or stolen money.
Visa’s Vision for Financial Inclusion
Vira Platonova, Chief Revenue Officer and SVP of Global Money Movements at Visa, emphasized the company’s commitment to financial inclusion and wealth-building through Visa Direct. Platonova stated, “Migrant workers have shown incredible resilience within the past year to support families back home, but high inflation and slowing economic growth have impacted the frequency with which they can send vital funds home. Our vision for Visa Direct is to simplify cross-border payments and streamline the way money travels, ensuring that more migrant workers and their families have access to these lifeline payments.”
Visa Direct is designed to facilitate quick and secure cross-border payments. The platform leverages Visa’s extensive global network to enable real-time transfers, making it easier for migrant workers to send money home. This is particularly important in today’s economic climate, where the need for timely financial support is critical. By streamlining the remittance process, Visa Direct helps ensure that funds reach their intended recipients quickly and securely, providing much-needed financial support to families and communities worldwide.
Survey Insights and Trends
The Money Travels: 2024 Digital Remittances Adoption study delves into consumer behaviors and preferences regarding remittances, providing valuable insights:
- Preferred Methods: Digital remittances are favored across most countries, with digital apps being the preferred method for both sending and receiving money. Exceptions include the UAE and Saudi Arabia, where physical locations still hold significant usage.
- Security Concerns: In Germany, sending cash via mail or courier is perceived as the least secure method. This perception highlights the need for more secure and reliable money transfer methods. Digital remittances address this concern by offering encrypted transactions that protect both the sender and the receiver.
- Motivations for Sending: The primary motivation for sending remittances varies by region. Supporting those in crisis is the main driver in India, Australia, and Singapore. In contrast, Latin American respondents cite unexpected needs or personal investments as key reasons. These motivations underscore the diverse needs that remittances fulfill, from immediate financial support to long-term investments.
- Hidden Fees: A significant issue with physical payments is the prevalence of hidden fees. Over one-third of respondents globally reported being offered "free" transfers for cash, checks, or money orders, only to discover hidden charges. This finding highlights the need for greater transparency in remittance fees. Digital platforms often provide more upfront information about fees, helping users make informed decisions.
- Remittance Markets: Countries such as Australia, Canada, China, and the United States are the largest sources of remittances. Brazil, India, Mexico, Peru, the Philippines, and Poland are major recipient countries. This data underscores the global nature of remittances and the wide range of countries that rely on these financial flows.
Collaborations for Efficient Money Movement
Visa collaborates with global remitters and enablement partners, including Brightwell, Thunes, Remitly, Western Union, and Asia United Bank (AUB), to enhance the efficiency of digitized remittances. These partnerships are crucial in simplifying the money transfer process and ensuring secure transactions. For instance, Thunes is a cross-border payments network that enables real-time transactions across multiple currencies. By partnering with Thunes, Visa can offer its customers access to a wider range of payment options and services. Similarly, partnerships with companies like Remitly and Western Union enable Visa to leverage their extensive networks and expertise in remittances, further enhancing the efficiency and reach of Visa Direct.
Survey Methodology
Morning Consult conducted the survey between December 2023 and March 2024, with a sample of over 40,000 remittance senders and receivers across North and Latin America, Europe, the Middle East, and Asia Pacific. The interviews were conducted online, with respondents weighted based on census estimates for age, race/ethnicity, gender, education, and region. This robust methodology ensures that the survey results are representative of the diverse population of remittance users worldwide.
Conclusion
Visa’s “Money Travels: 2024 Digital Remittances Adoption” report illuminates the evolving landscape of remittances, highlighting the shift towards digital methods and their critical role in supporting humanitarian efforts. As digital remittances continue to grow in popularity, Visa remains committed to enhancing financial inclusion and simplifying cross-border payments to support the global community. By understanding the key trends and insights from this report, stakeholders can better appreciate the importance of digital remittances in today’s world. As Visa continues to innovate and expand its services, the future of remittances looks promising, with greater accessibility, security, and efficiency on the horizon.
For more detailed insights and access to the full report, visit the official Visa Direct resources page.
About the Author
Howard Davidson is the CMO of Almond FinTech
Almond FinTech is a B2B fintech company transforming cross-border payments by empowering financial institutions and their customers with the best possible rates and near-instant FX settlements across all corridors globally. With Almond technology, institutions can guarantee fast, affordable, and transparent cross-border transactions. Finally.