NEW YORK— The global digital remittance market is forecast to reach $23.4 billion in 2024.
The market has been projected to rise swiftly at a CAGR of 13.5% and reach a value of $83.2 billion by the end of 2034, openPR reported, citing data from Fact.MR.
“Digital remittance services gained more importance during the COVID-19 pandemic. Restrictions on travel and public movement led to a reduced frequency of customer visits to banks and other financial institutions for remitting money,” openPR stated. “People began to increasingly rely on digital payment methods to conduct various transactions.”
The report further stated that an increasing number of cross-border transactions and the growing adoption of mobile-based payment channels are expected to boost the digital remittance market growth over the forecast period.
Migrant workers widely use digital remittance services to transfer funds to their families, openPR added.
‘Costly & Burdensome’
“Traditional money transfer methods are often burdened with hidden charges, intermediaries, and extensive paperwork, making them costly and cumbersome. In contrast, digital remittance offers customers faster and more convenient money transfer services,” openPR said.
Remittance Flows to Central Asia from Europe Declined During 2023
Separately, after growing a robust 18% in 2022, remittance flows to Europe and Central Asia declined by 10% to reach about $71 billion in 2023, according to the World Bank’s latest Migration and Development Brief.
The sharp decrease in remittances in 2023, from the high 2022 base, was driven mainly by a slowdown of money transfers from the Russian Federation to its neighboring countries, especially to Central Asian economies. Depreciation of the ruble against the dollar, which reached 39% by the end of 2023, a decrease in the number of remittances from Russia to Ukraine and a slowdown in the outflow of migrants from Russia to neighboring countries, as some of them decided to return home, also played a role, media outlet 24.kg said.
‘Restricted Transfers’
“Moreover, financial institutions in some destination countries have restricted transfers from Russia over concerns of additional sanctions. These factors, according to analysts, may have diverted remittance flows to informal channels,” 24.kg stated.
According to the World Bank’s estimates, last year remittance flows from Russia to Uzbekistan decreased, where the share of remittances from Russia in the structure of all remittances fell from 87% to 78%, as well as to Georgia (from 47% to 37%), Azerbaijan (from 82% to 63%), and Kyrgyzstan (from 95% to 94%), 24.kg noted in its analysis.