Cross-border payments finding more recipients with bank accounts
Fintech solutions to send cross-border payments to unbanked consumers through smartphones are gaining momentum globally, but the volume of remittances going to bank accounts in developing countries is also on the rise, according to Small World Financial Services.
The London-based money transfer operator’s volume for cross-border payments going from the U.K. to bank accounts in other countries rose 59% between 2014 and 2016, compared with a 39% for all other methods of receiving funds, Small World FS said in a Friday press release.
Remittances sent from the U.K. to bank accounts in South Africa and Asia showed the highest gains—81% and 124% respectively—during the two-year period, and those trends have continued this year, according to the release.
More than 2 billion global consumers remain unbanked, but World Bank data suggests more than 700 million consumers around the world have obtained a bank account since 2011.
This trend is affecting the mix of delivery channels for remittances, said Nick Day, founder and CEO of Small World, in the release. "Over the last two years, direct bank deposits have clearly outgrown any other payout method and it’s on track to continue."
Small World, founded in 2005, has developed a network of 800 outlets that includes banks, post offices and mobile telephone networks enabling cross-border funds transfers in local currency in nearly 100 countries.