While considerably not as noticeable in the context of a country’s overall gross national income, remittances play a vital role in the income of millions of people, especially in developing economies.
In fact, according to official statistics gathered by Knomad, global remittances reached a record US$647 billion in 2022—three times official development assistance. In terms of which places had the most inflow of remittances, India remains the largest. In 2022, it became the first country to ever receive over $100 billion in annual remittances.
While Mexico also received substantial remittance last year, it was still a distant second to India. It was followed by China, the Philippines, and Egypt as the countries receiving the highest amount of remittances in the world.
|Rank||Country||2022 Remittance Inflows (US$)|
|5||Egypt, Arab Rep.||$32,337M|
Admittedly, the totals per country and the overall global value of remittances is likely much larger than it officially is as there continues to be a significant portion of the population that still sends money through informal channels not captured by official statistics.
This is because, unfortunately, sending money is often expensive. According to World Bank Data, customers must pay $12.50 in costs on average whenever they send $200 to a low- or middle-income country.
Between the costs of multiple currency conversions, exchange controls, and a lack of interoperable payment systems, it all adds up to make sending money costly.
The role of global fintech
Financial technology, such as that of Black Banx, can continue to benefit countries receiving a lot of remittances in a number of ways. These include:
Reducing the cost of remittances
Digital banks can use technology to reduce the cost of remittances by eliminating the need for intermediaries and physical branches. A 2018 study by the GSMA found that the average cost of sending a remittance through a mobile money service was 3.51%, compared to 6.75% for the Remittance Prices Worldwide average.
Among the key features of Black Banx accounts is the ability to instantly send and receive payments in 28 Fiat and 2 crypto currencies, essentially making it easy for both senders and receivers of remittances. This is made even easier when both parties utilize Black Banx accounts, as conversion of currencies between internal accounts are for free.
Making remittances more accessible
Digital banks can make remittances more accessible by providing services through mobile phones and other digital channels. This can be especially beneficial for people in rural areas who may not have easy access to traditional banks.
A neobank by definition, Black Banx’s financial management services are readily accessible for anyone with internet access. So even in the farthest corners of India, China, or the Philippines that do have little to no presence of physical banks, customers with internet access can still receive and access remittances from overseas with just a few taps on their smartphones.
Speeding up the delivery of remittances
Digital banks can speed up the delivery of remittances by using real-time settlement systems. This can help recipients get access to their money sooner, which can be especially important for urgent needs.
As mentioned previously, customers have the ability to transfer money to other Black Banx accounts in a matter of seconds, proving beneficial to both senders and receivers who maintain a Black Banx account.
Promoting financial inclusion
Digital banks can promote financial inclusion by providing services to people who may not have access to traditional banking. This can help to improve the economic well-being of people in these communities.
Accessible to 180 countries and counting, Black Banx not only ensures that the unbanked duly receive the financial services they rightfully deserve, the company also empowers them with the ability to participate in the global economy. Whether it’s to receive remittances or to receive payments as a remote employee or international business, customers have a wider financial reach through Black Banx.
Growing the economy
In addition to these benefits, the likes of Black Banx can also help to boost the economy of a country receiving a lot of remittances by:
- Stimulating local businesses. When migrant workers send money home, they often use it to support local businesses. This can help to create jobs and boost economic growth.
- Reducing poverty. Remittances can help to reduce poverty by providing a source of income for families who would otherwise be struggling.
- Improving education and healthcare. Remittances can be used to pay for education and healthcare, which can improve the quality of life for people in these communities.
Overall, Black Banx plays a significant role in the development of countries receiving a lot of remittances. By reducing the cost, increasing the accessibility, and speeding up the delivery of remittances, Black Banx and others like it can help to make sure recipients and overall economies are able to get the most of the money they receive.
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