KoronaPay predicts a strong year for remittances

By Joy Dumasia

KoronaPay, the online money transfer service with over 13 million users worldwide, is predicting a strong year for the global remittance market after seeing remittances in January exceeding pre-pandemic levels by 12%. While migration continues to recover from Covid-related restrictions, KoronaPay has also seen the average remittance value rise by 40% since January 2021 due to migrant wage inflation.

Gleb Kozlov, CEO at KoronaPay, said: “Restrictions on movement led to fewer migrants and more jobs, driving very significant wage inflation for this segment of the workforce. This has resulted in material growth in average remittance value as migrants look to support friends and family through the economic hardship in their home countries. With restrictions also now easing and migration recovering, 2022 looks set to be a strong year for the remittance market.”

KoronaPay now expects the total volume of remittances from Europe in 2022 to exceed 2019 levels by 10-12%. At the same time, the share of online remittances continues to grow due to the convenience and attractive pricing of digital remittances (both desktop and apps). The growth in digital remittances has led to fierce competition for customers, with the cost of remittances falling further as transfer companies reduced fees and exchange rate margins.  

Gleb Kozlov, CEO at KoronaPay, said: “Covid dramatically increased the share of digital payments as offline transfers through non-bank players and transfers through bank branches fell. We don’t expect any reversal in this trend as digital remittances offer both lower fees and much greater convenience. However, digital remittances still represent a small share of the overall remittance market, and those providers that offer a hybrid model, combining offline and online, are best placed.”

Recently, IBS Intelligence reported that KoronaPay, the largest money transfer service across Russia and the CIS region, announced that it had reached $1 billion in monthly remittances after a strong performance in 2021 and continued expansion in Europe.