Partnerships key to success in the Philippines remittance market
Philippines’ remittance and mobile money market holds promise for both money transfer operators and domestic banks. September 05, 2012 | Levina LimThe remittance business was traditionally regarded as a business with low profit margins, dominated by non-bank entities - primarily Money Transfer Operators (MTOs) such as Western Union and MoneyGram International, as well as post offices throughout the world. The deteriorating economy has resulted in a more competitive banking sector, lowering the interest and profit margins of financial institutions’ existing sources of revenue, forcing them to consider tapping into a revenue stream viewed as providing a functional service rather than a strategic revenue source. According to the World Bank, global remittance flows were an estimated $483 billion in 2011, with $351 billion (73%) consisting of flows to developing countries. Global remittances are expected to surpass $593 billion by 2014, with 75% of the flow going to developing countries. Philippines’ unique landscape In the Philippines, remittances account for about 10% of the nation’s GDP. Migrant remittance inflow has risen steadily from $1.5 billion in 1990 to $21 billion in 2010, showing the industry to be resilient despite the global financial crisis. The Philippines is the fourth largest recipient for remittances in the world, trailing China, India and Mexico. Bangko Sentral Ng Pilipinas (BSP), the country’s central bank, projected that remittances for 2012 will hit $21.1 billion, estimated at a minimum of 5% more than the $20.1 billion recorded in 2011. However, as domestic employment opportunities improve, remittance growth is likely to falter. Robust cash transfers in the first quarter of 2012 were supported by the sustained demand for Filipino manpower in various labor markets,” said BSP Governor Amando Tetangco Jr. Migrant remittance inflows to the Philippines have been unaffected by the global financial downturn Figure 1. Migrant remittance inflows to the Philippines (2007-2011) Categories: Philippines,Remittance,retail, Philippines,Remittance,Retail Banking, Keywords:Philippines, Mobile Money, OFWs, Banco De Oro, Western Union, MoneyGram, Smart Communications, Globe Telecom, MTOs, GDP
Philippines, Mobile Money, OFWs, Banco De Oro, Western Union, MoneyGram, Smart Communications, Globe Telecom, MTOs, GDP
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