APAC emerging markets buck global remittance decline

China, India, and the Philippines remain “bright spots” for remittance activity, says Visa.

Whilst remittance flows in Asia Pacific have softened in the past year, emerging markets continue to witness growth, according to Visa.

Mainland China, India, and the Philippines notably remain “bright spots” for continued remittance activity, which is reportedly due to the pursuit to drive positive change and progress at home, the payments giant said in its annual “Money Travel: 2024 Digital Remittances Adoption” research report, which surveyed nearly 45,000 remittance senders and receivers across 20 markets. 

India, the world’s top remittance receiving market in 2023, continues to account for the highest remittance outbound and inbound flows in the region: 86% send and 85% receive money at least once a year.

In the Philippines, 79% and 84% of Filipinos are expected to send and receive money, respectively, at least once per year.

Markets such as India, Mainland China and Singapore have notably exceeded the global averages in the proportion of remittances sent and received in these markets, Visa said.

“The power of remittances in uplifting ecosystems and economies across the globe is well-understood. However, what can’t be overstated is the outsized impact of digital solutions in accelerating and strengthening the impact of every single dollar sent and received,” noted Chavi Jafa, head of commercial and money movement solutions, APAC, Visa.

Notably, remittances via mobile money increased by 48% in 2021, highlighting a shift towards digital wallets especially in Asia Pacific and Latin America, noted Jafa. 

Visa reported a twofold increase in digital remittances over the last two years. 

The Philippine market accounted for over 60% of all inbound remittance transaction volumes in Asia Pacific, with mainland China and India also experiencing similar acceleration in inbound remittances in recent years, Visa said.

Global decline
Whilst bright spots remained, overall, remittance usage declined in most markets as a result of inflation.

Volume-wise, remittance may be headed for a recovery. More than half (58%) of respondents expect to send more or the same amount of money overseas this year with mainland China (91%), India (74%), and the United Arab Emirates (73%) leading the way, Visa found.

Digital app-based remittances have emerged as the top method amongst consumers across all surveyed markets globally, with the UAE and Saudi Arabia as exceptions. Globally, almost 7 in 10 (67%) remittance users sent or plan to send money using digital apps.

Markets such as India, the Philippines, and Singapore exceeded global averages, with over 70% of remittance users having used an app-based digital payment method to send and receive money internationally. 

Hidden fees
However, over a third (36%) of respondents noted hidden fees even though they were offered a free transfer when sending cash, checks, and money orders.

The lack of transparency in service terms is also an issue in selected Asia Pacific markets, dampening consumer experiences, Visa found. Up to 1 in 2 respondents from APAC were offered a free transfer via digital means only to find hidden fees.

Respondents from India (55%), the Philippines (53%) and mainland China (51%) identified this lack of transparency in fees as a pain point.