After the resurgence of COVID-19 cases and mobility restrictions in the Philippines, all eyes are now on what 2022 will bring to the millions dependent on remittances each year.
WorldRemit country director Earl Melivo shares his market trend predictions for the year.
First, remittance growth is expected to continue.
WorldRemit processed nearly $10 billion in transactions in 2020 and remittances are expected to continue growing in 2022, perhaps at a slightly consistent rate when economies around the world stabilize, says Melivo.
Second, mobile wallets will grow in popularity.
The year 2020 saw a $2.4-trillion boom in contactless mobile payments and the industry is forecasted to maintain momentum, according to the WorldRemit executive.
Southeast Asia is the fastest-growing mobile wallet region—supercharged by e-commerce, internet, and smartphone penetration.
According to recent studies, Philippine mobile payment users will triple to 75.5 million by 2025.
In 2020, $12.7 billion in cross-border remittances were processed digitally. Electronic payment is a popular alternative to physical banking given the convenience of lower costs, greater convenience and the ability to send money on the go through mobile applications.
Third, safety comes first.
Melivo says amid safety concerns surrounding money transfers and sharing personal information online, money transfer companies have prioritized security measures above all else.
On the sending side, more companies are integrating additional features to verify customers through identity documents and their phone’s IP address, he says.
“On the receiving side—such is the case in the Philippines as one of the top five remittance recipients in 2021—more deposits will be made directly to bank accounts and e-wallets due as an increasing number of people prefer not to handle cash,” he says.
“With the support of the BSP, digital payments services will continue to improve,” says Melivo. “All WorldRemit transfers are encrypted through our automated machine learning system for fraud detection. Moreover, consumer education on the benefits and threats of the digital financial space is an ongoing endeavor by both the private and public sector to help protect customers.”
Fourth, speed is of the essence.
He says to deliver the demand for faster money transfers, companies continually invest in their technology systems to make data exchange with financial institutions, telcos and local partners and remittance flow more seamless.
Melivo says that at WorldRemit, 95 percent of transfers are ready within minutes. It uses API technology that enables it to facilitate remittances in almost real-time. Furthermore, increased communication and tracking features will be integrated for added peace of mind.
Fifth, the simpler the better.
Melivo says that eventually, the steps to money transfers will be better optimized—from downloading the application, creating the user profile and adding the beneficiary—until remittances become as easy as sending a text.
“While relatively new, it is evident digital remittance is here to stay as the method of choice for customers. They have proven they’re just as safe as bank transfers—only much faster, cheaper and more convenient,” he says.