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By Daniel Hernandez
Hispanics have been resilient in stepping up and responding for our loved ones. While remittances experienced a growth boom between 2021 and 2022 due to the COVID-19 pandemic, four years later we are seeing stability, with modest but solid growth.
In practice, this means that migrants do not forget their loved ones and continue to send remittances despite global economic challenges, a sometimes hostile environment in the United States and the political turmoil typical of an election year.
According to the World Bank (WB), official remittances to low- and middle-income countries slowed down in 2023 and achieved positive growth of 0.7%. In the case of Latin America, remittances reached a record $155 billion in 2023, up 9.5% from $142 billion in 2022. In Mexico, the first recipient country in the region, remittances from the United States reached a record $67 billion according to the World Bank and the Inter-American Development Bank. In 2024, overall growth is expected to be 2.3%.
Consumers have changed the way they handle money, increasingly adopting digital media. Digital money transfer services offer users a way to send money securely, quickly and easily via their mobile phones or electronic devices.
The cost of sending remittances has fallen significantly since 2009, from 9.7% of the value of the transfer to 6.2% in 2023. Digital remittance services are even cheaper, at around 4.6% of the value of the transfer. The United Nations aims to reduce this to below 3% by 2030.
Digital shipments are convenient, but we must consider some aspects so that our remittances reach their destination safely.
- Look for a reliable service that protects your data. When downloading an app, make sure the money transfer service is committed to protecting your data and not sharing it with third parties.
- Check the commissions and choose a service that is 100% transparent.
- Understand the payment methods available. The sender can send from home; the beneficiary can receive or collect cash through a bank account or mobile wallet.
- Pursue convenience and speed.
- Track transaction status.
* Daniel Hernández is Director of Growth for Latin America at Sendwave, a Zepz company. He previously served as Chief Revenue Officer at KIRU. He holds a Master’s degree from INCAE Business School. https://www.sendwave.com/es
photo: Daniel Hernandez
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