Remittances: the service provider perspective

26 Apr

The thesis examines international remittances (i.e. cross‑border payments sent by migrant workers) from the perspective of existing or potential service providers. It explains their economic significance and impact, characterizes the consumers involved with remittances and their behavior, describes the remittance process, and classifies and compares remittance transfer mechanisms. It also analyzes global remittance flows and the consumers’ cost. Furthermore, it summarizes the results of remittance provision market research, selects and reviews representative examples of existing services, and identifies categories of providers. The thesis then evaluates the strategic positions of existing types of services, and identifies factors that should distinguish successful providers. Finally, it assesses the business opportunity for new technology providers.

Remittances: the service provider perspective
Title: Remittances: the service provider perspective (1705 clicks)
Caption: Remittances: the service provider perspective
Filename: remittances-2.pdf
Size: 2 MB

Contents

Introduction

Basic framework

Terms and definitions

Remittances

General definition

Statistical definition

Payment systems definition

Key players involved in remittance transfers

Sender and receiver

Remittance service provider

Agents of remittance service providers

Remittance corridors

Remittance process

Remittance networks

Formal and informal remittance systems

Data sources

Description

Problems

Economic significance and impact

Roles of remittance payments

Stable source of external finance

Income critical to survival

Economic impact

Economic output and growth

Income equality

Global labor markets

Level of financial intermediation

Availability of credit to consumers

Foreign demand for local exports

Education and labor participation

Statistical evidence of economic impact

Consumer characteristics

Sender

Characteristics

Choice of service

Average value

Microeconomic motives to remit

Receiver

Characteristics

Uses of remittances

Distribution of remittances among different uses

Consumers’ cost

Major MTOs survey

Methods and challenges

Western Union

MoneyGram

Other estimates

USA—Latin America corridor

Other corridors

Process and mechanisms

Remittance process

Remittance transfer mechanisms and their features

Checks and bank drafts

Paper money orders

Postal giro transfers

Cash based electronic transfers

Hybrid electronic transfers

Card‑based transfers

Receiver‑centric model

Sender‑centric model

Card‑to‑card model

Account‑to‑account transfers

Mobile virtual account transfers

Person‑to‑person online transfers

Comparison of remittance transfer mechanisms

Provider market research

Money transfer operators

Western Union

MoneyGram

Other large and operators

Small operators

Banks

Wells Fargo

ICICI Bank

Bank of America

Credit unions

IRnet

Postal service organizations

United States Postal Service

New technology providers

Xoom

PayPal

Moneybookers

iKobo

HomeRemit.com

G‑Cash

Remit2India

Public sector initiatives

Strategy

Strategic positions of existing services

Modified SWOT analyses

Evaluation of competitive potential

Factors distinguishing successful ventures

Innovative services access channels

Global remittance flows

Receiver statistics

Country, country‑group and regional comparison

Dynamics and trends

Sender statistics

Country, country‑group and regional comparison

Dynamics and trends

Corridors

Flows between regions

Flows between countries

Barriers to free flow of international remittances

Technical and institutional incompatibilities

Cultural inertia

High entry barriers to cross border payments provision industry

Political aversion

Conclusion

Sources

Appendix

Receiver statistics recalculated using the IMF data

Country, country‑group and regional comparison

Dynamics and trends

Detailed receiver statistics by region

Latin America and the Caribbean

East Asia and Pacific

Europe and Central Asia

Middle East and North Africa

South Asia

Sub Saharan Africa

New members of the European Union

Detailed receiver statistics by income groups

Other receiver statistics

Disbursement mechanisms used by consumers

Country groups definition and methodology

IMF’s World Economic Outlook country groups and regions

IMF’s Balance of Payments Statistics Yearbook 2005 (part 2) country groups and regions

The World Bank’s World Development Indicators country groups and regions

Tables

Table 2.1: Informal funds transfer systems
Table 2.2: Unrecorded remittances
Table 2.3: Unrecorded remittances based on econometric modeling (1985–2000)
Table 2.4: Sum of workers’ remittances and compensation of employees (1998–2004)
Table 3.1: Adults receiving remittances in Latin America
Table 3.2: Banked population in selected countries (2004)
Table 3.3: Impact of workers’ remittances
Table 4.1: Unbanked remittance senders in the USA (2004)
Table 4.2: Spending remittances
Table 5.1: Percentage cost of sending remittances from USA via Western Union (November 29, 2006)
Table 5.2: Percentage cost of sending remittances via MoneyGram (November 29, 2006)
Table 5.3: Percentage cost of sending £100 from the UK
Table 5.4: Average percentage cost of sending $200 on selected corridors (2003)
Table 6.1: Comparison of remittance transfer mechanisms
Table 6.2: Advantages and disadvantages of money transfer mechanisms
Table 8.1: Modified SWOT for large MTOs
Table 8.2: Modified SWOT for small MTOs
Table 8.3: Modified SWOT for banks (excluding innovative remittance services)
Table 8.4: Modified SWOT for innovative bank remittance services
Table 8.5: Modified SWOT for credit unions
Table 8.6: Modified SWOT for postal services
Table 8.7: Modified SWOT for new technology providers
Table 8.8: Evaluation of competitive potential of remittance services
Table 9.1: Received remittances (2000–2004), regions
Table 9.2: Estimated flows of remittances by corridors (2000)
Table 9.3: Remittances origins to Latin American countries (2003)
Table 9.4: The world’s largest remittance corridors (2000)
Table 12.1: Received remittances (2000–2004), regions, IMF data

 

Figures

Figure 3.1: Received remittances and other foreign exchange flows (1970–2003)
Figure 3.2: Received remittances and other foreign exchange flows as % of GDP (1970–2003)
Figure 3.3: Volatility of remittances and other foreign exchange inflows (1980–2003)
Figure 3.4: Cyclicality of remittances and other foreign exchange inflows (1980–2003)
Figure 4.1: Senders’ perceptions of “why money transfer service takes additional money” (2002)
Figure 4.2: Average value of individual remittance payment (2002)
Figure 4.3: Frequency of receiving remittances (2003)
Figure 5.1: Percentage cost of sending remittances from USA via Western Union (November 29, 2006)
Figure 5.2: Percentage cost of sending remittances via MoneyGram (November 29, 2006)
Figure 5.3: Percentage charges made by banks and credit unions to tran sfer $400 from USA to Mexico by method (2003 and 2004)
Figure 5.4: Percentage cost of sending remittances from USA to Latin America (1990 and 2003)
Figure 5.5: Volume and cost of remittances from USA to Mexico
Figure 5.6: Percentage cost of sending remittances from USA to Latin America (February 2004)
Figure 5.7: Percentage cost of a ZAR 300 international transfer from South Africa to SADC countries (2005)
Figure 6.1: International remittance transfer operation
Figure 6.2: Value chain of remittance service providers
Figure 8.1: Key components in an RSP’s value chain
Figure 8.2: Annual received remittances and indicators of technological development (2000–2004), regions
Figure 8.3: Annual received remittances and indicators of technological development (2000–2004), top 30 receivers
Figure 9.1: Annual received remittances (2000–2004), regions
Figure 9.2: Annual received remittances (2000–2004), countries
Figure 9.3: Annual received remittances per inhabitant (2000–2004), regions
Figure 9.4: Annual received remittances per inhabitant (2000–2004), top 30 receivers
Figure 9.5: Annual received remittances as % of GDP (2000–2004), country income groups
Figure 9.6: Annual received remittances as % of GDP (2000–2004), top 30 countries
Figure 9.7: Annual received remittances (1970–2003), IMF country groups
Figure 9.8: Received remittances (2000–2004), regions
Figure 9.9: Annual growth of received remittances and GDP growth (2000–2004), regions
Figure 9.10: Absolute annual increase of received remittances (2000–2004), regions
Figure 9.11: Absolute annual increase of received remittances per inhabitant (2000–2004), regions
Figure 9.12: Annual received remittances (2000–2004), top five receivers
Figure 9.13: Annual remittances and their growth (2000–2004), top 10 receivers
Figure 9.14: Annual sent remittances (2000–2004), IMF country groups
Figure 9.15: Annual sent remittances (2000–2004), countries
Figure 9.16: Sent remittances (1970–2003), top five senders
Figure 9.17: Annual sent remittances and their growth (2000–2004), top 30 senders
Figure 9.18: Regional distribution of remittances to Africa (2001)
Figure 12.1: Annual received remittances (2000–2004), IMF country groups, IMF data
Figure 12.2: Annual received remittances (2000–2004), regions, IMF data
Figure 12.3: Annual received remittances (2000–2004), countries, IMF data
Figure 12.4: Annual received remittances per inhabitant (2000–2004), regions, IMF data
Figure 12.5: Annual received remittances per inhabitant (2000–2004), top 30 receivers, IMF data
Figure 12.6: Annual received remittances as % of GDP (2000–2004), income groups, IMF data
Figure 12.7: Annual received remittances as % of GDP (2000–2004), top 30 countries, IMF data
Figure 12.8: Received remittances (2000–2004), regions, IMF data
Figure 12.9: Annual growth of received remittances and GDP growth (2000–2004), regions, IMF data
Figure 12.10: Absolute annual increase of received remittances (2000–2004), regions, IMF data
Figure 12.11: Absolute annual increase of received remittances per inhabitant (2000–2004), regions, IMF data
Figure 12.12: Annual remittances received (2000–2004), top five receivers, IMF data
Figure 12.13: Annual remittances and their growth (2000–2004), top 10 receivers, IMF data
Figure 12.14: Annual received remittances (2000–2004), Latin America and the Caribbean
Figure 12.15: Annual received remittances (2000–2004), Latin America and the Caribbean, pie chart
Figure 12.16: Annual received remittances (2000–2004), East Asia and Pacific
Figure 12.17: Annual received remittances (2000–2004), East Asia and Pacific, pie chart
Figure 12.18: Annual received remittances (2000–2004), Europe and Central Asia
Figure 12.19: Annual received remittances (2000–2004), Europe and Central Asia, pie chart
Figure 12.20: Annual received remittances (2000–2004), Middle East and North Africa
Figure 12.21: Annual received remittances (2000–2004), Middle East and North Africa, pie chart
Figure 12.22: Annual received remittances (2000–2004), South Asia
Figure 12.23: Annual received remittances (2000–2004), South Asia, pie chart
Figure 12.24: Annual received remittances (2000–2004), Sub‑Saharan Africa
Figure 12.25: Annual received remittances (2000–2004), Sub‑Saharan Africa, pie chart
Figure 12.26: Annual received remittances (2000–2004), new members of the European Union
Figure 12.27: Annual received remittances (2000–2004), high income countries
Figure 12.28: Annual received remittances (2000–2004), upper middle income countries
Figure 12.29: Annual received remittances (2000–2004), lower middle income countries
Figure 12.30: Annual received remittances (2000–2004), low income countries
Figure 12.31: Annual received remittances as % of GDP (2000–2004), regions
Figure 12.32: Received remittances, FDI and ODA (2000–2004)
Figure 12.33: Disbursement mechanisms used in the USA—Latin America and the Caribbean corridor (2003)
Figure 12.34: Disbursement mechanisms used to receive money in Africa (2003)

No comments yet

Leave a Reply