Digital remittances: rewriting the history of families in our countries

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Among the many money movement use cases enabled by Visa Direct, one of my favorites is cross-border remittances, especially because of the positive ripple effect it triggers. As we all know, through remittances, the inflow of money from abroad first has a direct impact on the person receiving the remittance, but that is just the beginning of a sequence of events that energizes the entire community surrounding the person. This includes the small market, the local hair salon, or the neighborhood restaurant, ultimately favorably impacting the entire economy.

Particularly in the era of digitalization, remittances have become important monetary resources that are crucial to the well-being of not only families everywhere, but communities at large, considering that remittances how to get spain number for whatsapp can represent a significant part of the economy of some countries in Latin America and the Caribbean. For example, according to the most recent data from the World Bank, in 2021 personal remittances received in El Salvador, Honduras and Jamaica represented more than 25% of the GDP of these countries.¹


Visa Direct can help solve traditional physical payment challenges

Innovation in money movement has undoubtedly enabled greater speed, transparency, convenience, and cost savings for those who rely on remittances. Today, 53% of consumers admit to having turned to digital apps to send and receive funds around the world. A recent study released by Visa surveyed over 14,000 consumers in ten different countries (including Mexico and Peru) and found that digital remittances are quickly overtaking other popular ways of moving money like going to a physical branch or sending cash or checks.² And that’s because it’s clear that digital solutions driven in the region by payment platforms like Paysend, MACH, Kash, and Palla – and enabled by Visa Direct – can largely solve the traditional challenges of physical payments, which include long waiting lines, slow or uncertain delivery times, and tedious processes.

Digital remittances with Visa Direct can reach more than 7 billion endpoints around the world, whether through a debit card number, bank account or digital wallet. From Chile to Central America, we have partnered with different partners in the region to offer digital remittance solutions to more people in our countries. For example, Kash is using Visa Direct technology to move money faster in Panama, Nicaragua, Costa Rica, Honduras, El Salvador and Guatemala. And this is just the beginning.


The adoption of digital technologies in Latin America and the Caribbean

In Latin America and the Caribbean, in particular, the inflow of remittances and the adoption of digital technologies have been exponential and constant. On the one hand, the digital revolution has penetrated all facets of daily life, while remittance activity has continuously increased. The combination of these two factors is resulting in a visible shift in consumer preference and behavior. In fact, more than 70% of remittance senders in Mexico and Peru prefer digital payment methods over physical methods, indicating a significant increase in adoption over the past year. The adoption rate of digital payments is so high that few users report barriers when using app -based payment methods to move their money. Security is also playing a major role; according to this same survey, many Latin American consumers consider app-based digital technology – when used to send and receive money – to be “the safest viable option.”

Despite some of the highlighted global trends, such as notable shifts towards a digital culture and an increase in adoption, remittances still represent one of the most fragmented sectors of financial services in terms of technology, economic models, providers and user experience. All of this represents an incredible opportunity. With solutions like Visa Direct we can be agents of change, reducing the cost of remittances and peer-to-peer money transfers and adding efficiencies to make it easier for more people to receive money in a way that is more useful to them. In addition, our work with Visa Direct creates new and innovative opportunities for financial inclusion, simplifying the process of moving money and leaving fewer people out of the global financial system.

At Visa, empowering our global partners and senders and redefining the remittance landscape is a vital priority. To that end, we remain committed to collaborating with all players in the ecosystem to create a remittance network that helps more people prosper in more places.

If you want to learn more about how Visa Direct is helping transform the global movement of money, click here.Click here.