Digital Remittance Market Size, Share & Trends Report

Digital Remittance Market Size, Share & Trends Analysis Report By Type (Inward, Outward), By Channel (Money Transfer Operators, Online Platforms), By End Use, By Region, And Segment Forecasts, 2020 - 2027

  • Published Date: May, 2020
  • Base Year for Estimate: 2019
  • Report ID: GVR-4-68038-520-5
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2018
  • Number of Pages: 140

Report Overview

The global digital remittance market size was valued at USD 15.01 billion in 2019 and is expected to register a CAGR of 12.2% from 2020 to 2027. The market growth can be attributed to the growing need for safer, secure, and quicker cross-border monetary transactions. Various businesses serve customers from other countries and rely on procuring goods from suppliers abroad. This has increased the necessity of digital remittances in order to receive payments from customers and make payments to those suppliers.

U.S. digital remittance market size

Rising smartphone penetration, coupled with the increasing number of digital-savvy customers opting for digital remittances, is expected to drive the market over the forecast period. Additionally, increasing internet penetration has enabled customers to access financial remittance services. Moreover, rise in payment automation and digitalization is expected to create growth opportunities for market over the forecast period. Furthermore, increasing number of economic migrants traveling from developing economies to developed economies in search of better work opportunities is anticipated to contribute to market growth.

Rapid growth in industrialization and urbanization is attracting the population of different semi-rural and rural areas towards the urban parts of the world. People are moving to various locations and countries in search of education or jobs. This, as a result, is driving the need for cross-border transactions. Moreover, the usage of digital remittance services offers users with high security and privacy.

The digital remittance is anticipated to emerge as the preferred mode of remittance since financial institutions are opting for the transparent and data-driven ecosystem. These institutions are collaborating with an efficient network of partners in order to provide better digital remittance services to their customers. The market for digital remittances would continue to grow as service providers are focusing on expanding the coverage of their internet networks so that everyone can get access to their banking and financial services. Customers are increasingly adopting digital remittance services owing to low remittance costs and reduced money transfer time.

Rapid adoption of banking and financial services, coupled with the increasing number of campaigns about digitalization, is providing impetus to the market growth. Digital remittance operators are challenging the cash-in-hand providers due to the ease of usability and reduced user fees. Furthermore, these operators provide a digital network that includes easy to use mobile applications and removes the need for hectic form-filling procedures. Customers across the globe are adopting banking and financial services as these services provide a faster and convenient way of payment.

Type Insights

Based on the type, the digital remittance market has been segmented into inward digital remittance and outward digital remittance. The outward digital remittance segment dominated the market and is anticipated to maintain its lead over the forecast period. Customers are adopting this method as it provides faster and hassle-free money transfers. This digital remittance service further offers protection against exchange rates volatility.

The inward digital remittance segment is expected to witness the fastest growth over the forecast period. Growing adoption of mobile payment technology for fund transfer among the migrants in the developed countries is expected to fuel the segment growth over the forecast period. This digital remittance type enables secure, quick, and safe transactions and offers advisory services to the customers. Furthermore, it offers services to both resident and non-resident customers of the bank.

Channel Insights

Based on the channel, the market has been segmented into banks, money transfer operators, online platforms, and others. The money transfer operator segment held the largest market share in 2019 due to increasing adoption of mobile-based apps and mobile banking, which are introduced by financial institutions and money transfer operators. Moreover, digitization in the cross-border money transfer industry is expected to create growth opportunities for incumbent operators. Moreover, customers are widely adopting the money transfer operator model as it offers various benefits, such as affordability, transparency, safe and secure transaction, and convenience in money transfers.

Online platforms are anticipated to witness the highest growth over the next few years. Online money transfer platforms manage transfers of funds between enterprises as well as enterprises and their customers. This type of platform is used to securely transfer money in several currencies for various purposes, such as moving funds or paying invoices between different subsidiaries. This online money transfer platform is mainly used by Business-to-Business (B2B) customers and finance professionals to make payments online.

End-use Insights

Based on end-use, the market has been segmented into migrant labor workforce, personal, small businesses, and others. The personal segment held the largest market share in 2019 owing to the large number of fund transfers carried out by the migrants that are studying overseas. Digital remittance services allow customers to deposit their personal cheques drawn in foreign currencies and payable at foreign centers for crediting to their account. Increased smartphone and internet penetration across the globe is expected to further propel the segment growth over the forecast period.

Europe digital remittance market share

The migrant labor workforce segment is expected to witness significant growth over the forecast period. The digital remittance platform helps migrants to compare money transfer costs and locate support organizations. This platform has made it more affordable and easier for migrant workers to send money home. Furthermore, this platform offers information on financial services, such as mobile wallets, bank accounts, insurance, micro-credits, and a budget calculator. These services help migrants to save for their future and improve their finances.

Regional Insights

North America dominated the market and held the largest market share in 2019. Several people migrate to North America in search of better job opportunities and education as well as for business purposes, thereby fueling the regional market growth. The region is home to major financial service and communication companies, such as MoneyGram, Continental Exchange Solutions, Inc., and Western Union Holdings, Inc. Increasing number of immigrants in North America from the under-developed regions of the world has provided a thrust to the regional market growth.

Asia Pacific is expected to emerge as the fastest-growing regional market over the forecast period. Growing base of customers that are comfortable with using mobile devices in Asia Pacific is expected to create growth opportunities for the regional market. People from various countries, such as China and India, are progressively engaging with their overseas counterparts for education, business, and entertainment-related activities, which involve the transfer of money overseas. This, as a result, is anticipated to fuel the regional market growth. Increasing adoption of digital transfer networks, such as digital currencies, mobile money, mobile phone technology, and electronic identification, to remit money has made cross-border payments easy in Asia Pacific.

Key Companies & Market Share Insights

Vendors in the market are focusing on establishing partnerships to acquire more market share. For instance, in April 2017, TransferWise Ltd. partnered with DBS Bank to expand its presence in Singapore and strengthen its foothold in the country. Alliances between traditional financial institutions and emerging financial technology companies have proven to offer a competitive advantage to companies over others.

Expansion of operations is the key focus area of market incumbents to gain a competitive edge in the market. For instance, in September 2018, Remitly, Inc., a financial company based in the U.S., expanded its operations in 12 European countries. This has brought the modern remittance functionalities and processes in use for several customers in the region. Vendors are leveraging their global financial settlement engine, distribution network, cloud-based infrastructure with integrated APIs, and their compliance program to enable secure and seamless transfers around the world. Some of the prominent players in the digital remittance market include:

  • Azimo Limited

  • MoneyGram

  • PayPal Holdings, Inc.

  • Western Union Holdings, Inc.

  • WorldRemit Ltd.

Digital Remittance Market Report Scope

Report Attribute

Details

Market size value in 2020

USD 16.20 billion

Revenue forecast in 2027

USD 36.23 billion

Growth Rate

CAGR of 12.2% from 2020 to 2027

Base year for estimation

2019

Historical data

2016 - 2018

Forecast period

2020 - 2027

Quantitative units

Revenue in USD million/billion and CAGR from 2020 to 2027

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Type, channel, end-use, and region

Regional scope

North America; Europe; Asia Pacific; Latin America; and MEA

Country scope

U.S.; Canada; U.K.; Germany; China; Japan; India; Brazil

Key companies profiled

Azimo Limited; MoneyGram; PayPal Holdings, Inc.; Western Union Holdings, Inc.; and WorldRemit Ltd.

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Segments Covered in the Report

The report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global digital remittance market report based on type, channel, end-use, and region:

  • Type Outlook (Revenue, USD Million, 2016 - 2027)

    • Inward Digital Remittance

    • Outward Digital Remittance

  • Channel Outlook (Revenue, USD Million, 2016 - 2027)

    • Banks

    • Money Transfer Operators

    • Online Platforms

    • Others

  • End-use Outlook (Revenue, USD Million, 2016 - 2027)

    • Migrant Labor Workforce

    • Personal

    • Small Businesses

    • Others

  • Regional Outlook (Revenue, USD Million, 2016 - 2027)

    • North America

      • The U.S.

      • Canada

    • Europe

      • Germany

      • The U.K.

    • Asia Pacific

      • China

      • India

      • Japan

    • Latin America

      • Brazil

    • Middle East & Africa

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