Visa has found that more remittance senders and receivers are using digital apps.
Fifty-three percent of these consumers use digital apps to send and receive money around the world, while 34% go to a physical bank or branch, 12% send cash, checks or money orders by mail and 11% give money to another person who is traveling to their home country, Visa said in a Tuesday (March 21) press release.
“This new research shows incredible acceleration of digital payments, but there is still more the industry can do to bring streamlined remittances within reach for more migrant workers and their families who rely on these lifeline payments to do everything from pay for food, education or even unforeseen medical costs,” Ruben Salazar, global head of Visa Direct, said in the release.
Among the pain points faced by consumers on the send side are fees that are too high, which was cited by 38% of senders in the United Arab Emirates (UAE), and issues with calculating the exchange rates, which were cited by 37% of those in Singapore, according to the press release.
At the same time, a large share of remittance users consider app-based digital payments to be the most secure method for sending money internationally. For example, 61% of those in Singapore said ease of use and security is the reason they use digital-only means, the release said.
PYMNTS research has found that the need for affordability and convenience drives the way consumers send and receive cross-border payments.
Payment services providers (PSPs) that offer alternatives to traditional remittance payments methods may see a surge of interest among consumers seeking to avoid high fees and extended processing times, according to “The Digital Currency Shift: The Cross-Border Remittances Report,” a PYMNTS and Stellar Development Foundation collaboration.
Visa Direct, the company’s real-time push payment offering, logged 1.9 billion transactions in the fiscal first quarter, up 39% year on year, Visa CEO Al Kelly said Jan. 26 during the company’s quarterly earnings call.
Non-U.S. Visa Direct transactions grew by roughly 20 percentage points, Kelly added.
Cross-border remittances and account-to-account transactions hold particular appeal, Visa management said during an earlier earnings call.