Traditionally money flowed across nations through trade channels only. However, the globalization has become a reality in the past few decades. With fast opening economies and growing socio political activities, more and more people from underdeveloped or developing economies are working outside the countries of their origin. Remittance money has been growing by the years and is being considered an important financial resource for development as well as a social change by financial planners in developing economies. The worldwide inflow of remittances is growing continuously since past several years with the exception of 2009 which was characterized by global economic slowdown. The market is expected to grow at a CAGR of approximately 8.5% during 2012-2014.

The developing countries, which include both low and middle income countries, account for the majority inflow of remittances in the world. The huge emigrant population moving from the developing regions of India, China, Philippines, and Mexico make these countries the highest recipient of remittances. The largest source of remittance flow to developing regions is high income countries including the US and Western Europe, with the GCC countries fast developing as an important source.

With the evolution of the new world economic order, countries with high industrial and economic growth sought more manpower from all across the globe to meet their development requirements. Remittances from such migrating people have become an important part of economic upliftment of their countries. Scientific and industrial development achieving regular new landmarks has made global economic growth a reality. With more work opportunities, employment rate at global levels is improving and giving impetus to the flow of remittances worldwide. A flourishing remittance market is gaining strength from economic development of GCC countries. Remittances are movement driven and migration of working people world over is galloping.

Process of economic growth is face to face with new challenges too. Governments are finding imposition of tax on remittances as fresh source of national income which is a likely deterrence to the growth of remittance market. But on the other hand, new efforts are underway by international community like the initiative taken by World Bank to develop a comprehensive database on money transfer to help the remittance market. One new highly discouraging feature is imposition of regulatory requirements regarding AML/CFT.

The global remittance market is characterized by intense competition with numerous global and regional players operating in the market. The western Union Company and MoneyGram International, Inc. are the two leading money transfer service providers in the world. Furthermore, postal organizations also pose significant competition to the existing players in the money transfer industry due to their wide reach and low cost services.

The report analyzes the global remittances market with focus on India, China, Mexico and Philippines. It also discusses the major trends, growth drivers and challenges for the remittances market. The report presents the competitive structure of the industry and profiles major players with a discussion of their key business strategies.

By combining SPSS Inc.’s data integration and analysis capabilities with our relevant findings, we have predicted the future growth of the industry. We employed various significant variables that have an impact on this industry and created regression models with SPSS Base to determine the future direction of the industry. Before deploying the regression model, the relationship between several independent or predictor variables and the dependent variable was analyzed using standard SPSS output, including charts, tables and tests.

1. Overview

2. Global Remittance Market

Remittance Inflow Growth
Remittance Outflow Growth

3. Global Remittance Market by Regional Income Characteristics

3.1 Low Income Countries
3.2 Middle Income Countries
3.3 High Income Countries

4. Remittance Market of Developing Countries

4.1 East Asia and Pacific Region
4.2 Europe and Central Asia Region
4.3 Latin America and Caribbean Region
4.4 Middle East and North Africa Region
4.5 South Asia Region
4.6 Sub Saharan Africa

5. Largest Remittance Receiving Countries

5.1 India
5.2 China
5.3 Mexico
5.4 Philippines

6. Market Dynamics

6.1 Key Trends

6.1.1 Expanding Economies of GCC Countries: An Attractive Source of Migrant Remittances
6.1.2 Remittances: A Catalyst for Financial Inclusion
6.1.3 Financing the Development through Diaspora Route
6.1.4 Trends in Remittance Costs

6.2 Significant Developments

6.2.1 Money Transfer Database: A World Bank - African Union Initiative
6.2.2 Post Offices: A Potential Conduit to Provide Remittance and Financial Services

6.3 Growth Drivers

6.3.1 Increasing International Migration
6.3.2 Global Economic Growth
6.3.3 Increasing Employment Rates

6.4 Challenges

6.4.1 AML/CFT Requirements Discourage Free Flow of Remittances
6.4.2 Taxing Remittances: An Unfavorable Option

7. Competitive Scenario

Competitive Overview
Market Share

8. Company Profiles

8.1 The Western Union Co.

Business Description
Key Financials
Business Strategies
Expansion of Retail & Electronic Channels
Adoption of New Technologies

8.2 MoneyGram International

Business Description
Key Financials
Business Strategies
Product & Infrastructure Development
Strengthening Sales & Marketing Activities

8.3 Euronet Worldwide

Business Description
Key Financials
Business Strategies
Zeroing in on epay Business
Money Transfer Segment Strategy

9. Market Outlook

9.1 Market Forecast

9.2 Forecast Methodology

9.2.1 Dependent and Independent Variables
9.2.2 Correlation Analysis
9.2.3 Regression Analysis


List of Charts

Value Chain: Remittance Industry
Global Remittance Inflows, 2001-2011
Global Remittance Outflows, 2001-2010
Top 10 Addressers of Remittances, 2010
Remittance Flow to Low Income Countries, 2008-2011
Remittance Flow to Middle Income Countries, 2008-2011
Remittance Flow to High Income Countries, 2008-2011
Remittance Flow to Developing Countries, 2008-2011
Sources of Remittances for Developing Regions, 2010
Remittance Flow to East Asia and Pacific Region, 2008-2011
Remittance Flow to Europe and Central Asia Region, 2008-2011
Oil Prices Driving Remittances to Central Asia, Q304-Q311
Remittance Flow to Latin America and Caribbean Region, 2008-2011
The US Housing Starts, Annualized, Oct-05 to Oct-11
US Migrant Employment by Sector, Dec-09 to Sep-11
Migrant and Natives’ Employment in the US, Sep-08 to Sep-11
Remittance Flow to Middle East and North Africa Region, 2008-2011
Remittance Flow to South Asia Region, 2008-2011
Migrant Deployment from and Remittance Flows to Bangladesh, Nov-08 to Oct-11
Remittance Flow to Sub-Saharan Africa Region, 2008-2011
Top 10 Recipients of Migrant Remittances, 2011
Top 10 Recipients of Migrant Remittances as % of GDP, 2010
Remittance Flows to India, 2001-2011
Private Transfers to India, Q308-Q211
Remittance Flows to China, 2001-2011
Remittance Flows to Mexico, 2001-2011
Remittance Flows to the Philippines, 2001-2011
Global Average Remittance Costs, 2008-Q311
Cost of Sending Remittances to Developing Regions, Q311
Global GDP Growth, 2001-2011
International Migrants Population, 2000-2010
Global Employment Rates, 2000-2010
Money Transfer’s Organizations Market Share, 2010
Western Union’s Revenue Share by Business Segments, 2010
Western Union’s Money Transfer Revenues, 2006-2010
MoneyGrams’ Revenue Share by Business Segments, 2010
MoneyGram’s Money Transfer Revenues, 2008-2010
Euronet’s Revenue Share by Business Segments, 2010
Euronet’s Money Transfer Revenues, 2008-2010
Global Remittance Inflow Forecasts, 2009-2014F

List of Tables

Dependent & Independent Variables (2001-2011)
Correlation Matrix
Model Summary – Coefficient of Determination
Regression Coefficients Output