RemitSCOPE: Remittance markets and opportunities – Asia and the Pacific
Pedro De Vasconcelos, Senior Technical Advisor and Manager of the Financing Facility for Remittances, IFAD
Leon Isaacs, CEO, Developing Markets Associates Ltd. (DMA)
This session provided an overview of the Asia-Pacific remittance market and launched RemitSCOPE, the new all-encompassing database. The content for the session derived therefrom.
The Asia-Pacific market is massive. Encompassing over 50 countries and 6,000 transaction corridors, the region is geographically big, ethnically and politically diverse, and challenging to understand. While Asia-Pacific is the biggest remittance recipient in the world, with the top three remittance receiving nations, it also contains some of the smallest nations and most remittance dependent nations globally. It received US$256 billion dollars in remittances in 2017 (53%of worldwide flows) through 850 million transactions. The average cost to send to the region is slightly below the global average (6.9%) but there is a long way to go to meet SDG 10.c. Despite the size of the market, reliable and consistent data is still an issue. As a result, it has been difficult to fashion effective business strategies and public policies. Nevertheless, as it becomes better understood, the region represents exciting opportunities for the private sector to tap into un(der)served markets and for the public sector to implement enlightened policies that leverage remittances for productive purposes.
Recognizing that the lack of data has hampered efforts to unlock the potential of remittances for the region, IFAD researched, collected and collated a broad range of useful data on all 50 countries in Asia and the Pacific. The data was launched at GFRID in the form of the new portal: RemitSCOPE Asia-Pacific. RemitSCOPE brings together information on the diverse market, providing regional, sub-regional and country-level data, as well as market analysis. These data are aimed at providing policy makers and the private sector with the facts they need to shape better policies and make better business decisions, and will be continually updated.
For example, an MTO needs to understand the remittance sender, the receiver, the operating environment in each country (including the regulations), and the best way to market to these actors. Previously potential new market entrants needed to gather this information through their own research. This research needed to be carried out in multiple corridors before deciding to launch a service. Having such information compiled in one place makes it easier to enter new markets, because the basic information is now publicly available in one easy- to -find location. Moreover, it can help to harmonize diverse practices and regulations across countries, and ensure that the strategies of the private sector match the needs of remittance families. For the public sector it can help to share best practice between policy makers, regulators and other development professionals.
RemitSCOPE provides the public and private sectors with easy-to-access data on Asia-Pacific remittance markets. Through the open sharing of information among players and well-organized data sets, it offers a better understanding of the region. As a result, better products and better policies can be developed to expand the remittance markets and increase financial inclusion.
- MTOs are the main operator for sending; banks for receiving;
- Cash is still dominant; and
- Average costs (6.9% per US$200) are falling but there is a long way to go.