Digital remittances are changing the landscape of global money movement

By Puja Sharma

–Around 57% of surveyed remittance senders and 52% of surveyed remittance recipients believe that making it easier to send money to other countries is the key benefit of digital payments

–Among remittance senders who do not use digital methods, 36% are very likely to use digital transfers in the future

Money movement across borders can be fragmented, slow, and inefficient—Visa’s research reveals consumers across UAE see the future as digital Around 70% of surveyed remittance users across the UAE have used an app-based digital payment method to send or receive money internationally, in comparison to 53% globally.

Remittances are not only a lifeline for millions of expatriate workers and their families, but they are also vitally important for the prosperity of many developing economies around the world. As the amount of global remittance inflows continues to reach new records, around 70% of surveyed consumers in the UAE are turning to digital apps to send and receive funds internationally, in comparison to 53% of consumers globally.

Visa, the world’s leader in digital payments, recently unveiled its “Money Travels: 2023 Digital Remittances Adoption” research report, a survey of over 14,000 consumers across ten countries, revealing that digital remittances are quickly becoming the most popular way to move money internationally when compared to going to a physical bank or branch (34%); sending cash, checks or money orders by mail (12%); or giving money to another person who is traveling to their home country (11%).

In comparison, around 70% of remittance senders in the UAE use app-based digital transfers, and slightly fewer send remittances from a physical location (63%), compared to sending checks or money orders by mail (8%); sending cash by mail (9%); or giving money to another person who is traveling to their home country (11%).

In conjunction with the study, Visa launched “Money Travels,” a new podcast series unearthing how payment-related topics unfold differently in various places around the world and highlighting the stories of real people, payment experts, and partners.

“Fast, easy, and secure payments are crucial for expatriate workers to provide instant financial support for their families, particularly in emergencies,” said Visa’s Salima Gutieva, VP and Country Manager for UAE. “This new research shows the rapid acceleration of digital payments in the UAE, which is among the largest source markets of remittances globally. However, the industry needs to continue further streamlining remittances within reach of more expatriates and their families who rely on these lifeline payments to do everything from pay for food, education, or even unforeseen medical costs.”

The Money Travels: 2023 Digital Remittances Adoption study examines how consumers in the UAE market send money abroad, diving into the rates, methods, and reasons for sending and receiving these lifeline payments.

Visa works in collaboration with global remitters such as Brightwell, Paysend, Western Union, and Xoom to help enable efficient money movement through digitized remittances. “Visa Direct is paving the way for pioneering opportunities for financial inclusion and wealth building. We aim to simplify cross-border payments and lead tomorrow towards financial well-being for everyone in the UAE and across the world,” continued Gutieva.

Key highlights:

• Digital remittances are the preferred method amongst surveyed consumers across the UAE. Around 70% of remittance users surveyed in the UAE have used an app-based digital payment method to send/receive money internationally, whereas only 7%-11% of surveyed UAE remittance users rely on cash, checks, and money orders.
• Remittance users in the UAE expect to use digital transfers more often in the future, and about a third say they will send larger amounts of money in the future. Sixty percent of surveyed remittance users intend to use digital money transfers more often within the next 12 months compared to the 3% who don’t foresee adapting to digital remittance methodologies.
• Fees – including how exchange rates are calculated – are a common pain point for digital transfers among UAE consumers surveyed. Thirty-eight percent of surveyed remittance senders and 35% of surveyed remittance recipients reported fees as a pain point; 28% of surveyed remittance senders and 23% of surveyed remittance recipients reported issues with calculating the exchange rate.
• Only a few remittance senders in the UAE have not used digital methods, but even those non-adopters are likely to use digital transfers in the future. Thirty-six percent of surveyed remittance senders are very likely to use digital transfers in the future; while only 1% have reported that they are highly unlikely to do so.
• Most remittance users in the UAE believe digital transfers will have a positive benefit, including making it easier to send money and making sending money more secure. Fifty-seven percent of surveyed remittance senders and 52% of surveyed remittance recipients believe that making it easier to send money to other countries is the key benefit of digital payments while saving time for friends and family accessing transferred funds and money being sent safely, privately and quickly follow respectively in terms of the positives of digital payments.