Be it a monthly expense to ageing parents from a child from a big country, or the higher education expenses to a child in developed country. International remittances have existed ever since people have started moving to different countries, albeit the forms have changed over time. The number of expats in different countries are at an all-time high, thanks to the booming economies and world turning into a global village.
According to World Bank, by 2016 more than 250 million people or 3.4% of the world population lived outside their country of birth. This has resulted into a record inflow of remittance taking place between nations. By 2015, approximately $601 billion in USD was transferred between countries, $441 billion of which was received by developing countries. The countries receiving the largest share of remittances are China and India, making Asia the highest remittance receiving continent. According to 2015 estimates, India and China received $72.2 and $63.9 billion dollars respectively. Remittances also make a sizeable part of the GDP for certain countries majorly the small and developing countries like Tajikistan and Kyrgyzstan. Have a look at the incoming and outgoing remittances across the world here.
Although remittances hold crucial value in the economy of smaller countries, they are not entirely a sanctity. In recent times, there is an increment in the number of incidents involving money laundering or terror funding which can be directly linked to the ease of remittances. To keep a tab on such issues, the costs associated with international remittance has gone up which has affected the companies facilitating remittance and the people who use the services. Nonetheless, Microsoft co-founder and remittance regulation activist Bill Gates has mentioned that if remittance costs were cut in half, an extra $15 billion a year would be available for countries in the developing world.
According to a 2010 survey of central banks of several countries, it was established that not all countries report the remittance data in a globally accepted format and miss out on details around remittance flows via money transfer operators, post offices or local money lenders.
How does it work?
Remittance through Banks directly
Banks offer direct transfer of money to other bank accounts. This can be done both online or offline. The rates charged by Banks are subjective to the respective bank while the time frame involved is typically 3-5 days.
Remittance through Bitcoins
Bitcoin is the latest rage in the financial world and also a preferred medium for fund transfer across borders. While some may argue about the liquidity of the cryptocurrency lately, there’s no denying that Bitcoin holds a high position in the financial market. Bitcoin has been blamed for higher rates during international remittances. This is primarily due to the two stages involved in converting Bitcoin to source and target currencies.
Read also - Story of Bitcoin – The other kind of Money
Remittance through Money Transfer Services
Several companies like Western Union, Money-Gram, etc. offer exclusive remittance services but they too come with a hefty price tag. The time required to make the transfer is comparatively lower which makes it a preferred medium among the users.
Remittance through Mobile Wallets
A popular way to transfer funds, mobile wallets too allow international remittances. Due to the constantly growing prevalence of cashless transactions, the number of mobile wallets is on an upward trajectory. It only makes sense to include remittance as a service here. Since the medium is already popular, additional services for remitting money does not involve any extra operational cost.
With remittance being into spotlight, Panamax’s e-wallet platform MobiFin recently came up with an upgraded version which offers both advanced international and domestic remittance services. Apart from the exquisite real-time remittance services, MobiFin acts as an all-inclusive wallet which facilitates international remittance of Bitcoin along with Bitcoin buying and selling. Both the fiat and Bitcoin wallet can be maintained on the MobiFin platform with ease. MobiFin also conveniently interfaces with multiple exchanges to pick the best rate while buying and selling the Bitcoins. Why restrict to just money transfer? MobiFin also allows sending goods to the near and dear ones internationally in the form of vouchers.
MobiFin Remittance solution allows rolling out the domestic and international remittance service through a cost effective, cashless model. This solution can be easily integrated with global remittance providers like Money-Gram, Western Union, RIA etc. The solution also allows full traceability and transparency with built-in KYC and anti-money laundering features to meet regulatory requirements.