Global Remittance and the most potential markets

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Aug 4 . 4 min read

A remittance is a fund an expatriate sends to his or her country of origin via wire, mail, or online transfer ( According to a World Economic Forum report, remittance totaled more than USD$714 billion in the year 2019 ( Remittance has a significant impact on the economies of developing countries and affects the lives of millions.

The World Bank estimated that the average remittance amount is USD$200 with a cost of 5-10% and takes an average of two to five days to settle. The key reasons for the high charges and inefficiencies are old technology, poor infrastructure, regulations, and interoperability problems. (

The blockchain technology’s decentralised ledger, immutable records, and inherent security through cryptography seems a perfect solution to the problems.

Every five percent of transaction cost saved equals to more than USD$35 billion per year of money that go into the hands of people in the developing countries that need the money. Beyond the direct cost-saving, the almost real-time transaction and the assurance of security are likely to motivate the migrate workers to transfer more money back to their home countries. This will speed up the development of their home country’s economy. Given better resources, the human capital in these countries, especially the children of these workers will have a better chance of development and over time lead to a more productive society.

In the longer term, it is likely to encourage the flow of people from developing countries to the developed countries. Barring political challenges, the economic impact of such worker movement will be hugely positive. The home countries will benefit from greater access to financial resources while the destination countries will benefit from the human resources boost that translates to higher economic growth.

Socially, the elimination of friction, high cost, inefficiencies in the money transfer system will lead to greater peace of mind for these workers as well as save them time that can be channeled to more productive use.

We believe that the remittance industry with its deep-seated inefficiencies represents a golden opportunity for building new blockchain-based infrastructure and a new business model. The huge financial, economic, and social value will translate into a compelling investment opportunity.

According to a World Bank Group report, the global market size for remittances is $613 billion in 2017 ( The world market for remittances has been on the rise for the last 15 years:

In terms of cost of transfer, the cost in South Asia was the lowest, at 5.2 percent, while Sub-Saharan Africa has the highest average cost at 9.4 percent.

The remittance market has seen an increasing entry of players using cryptocurrency and blockchain technologies. According to a recent market report, the top six blockchain remittance companies( are ABRA (worldwide), COINS.PH (The Philippines), BITPESA (Africa), REBIT.PH (The Philippines), BIT2ME (Europe), BITSPARK (Asian). It is notable that the Philippines has attracted the interest of one-third of the top companies.

In assessing the addressable market, the factors considered include: size of market, cost of transfer, regulatory stance, and targeted customer’s acceptance of such technology.

Analysis shows that the USA, Saudi Arabia, and Switzerland are the top three sending money countries while India, China, and The Philippines are the three money receiving countries. These three receiving countries account for >$100Bn of receiving funds. See the data in the charts:

Source: World Bank Data, 2017

Considering the readiness of blockchain ecosystem in the sending country, starting with the US as the sending country will be logical.

As to receiving countries, India and China have banned ICOs (source below). While the ICO can be launched in the US or another country, considering that India and China have banned ICOs (, we filter out these two countries in the first phase.

So the launch addressable market we chose is the Philippines. With a size of USD11Bn per year, it is sufficiently big. Further, people of the Philippines are well versed in English so the hurdle of running the business in English will be lowered.

The fact that two of the world’s top six blockchain remittance startups are targeting The Philippines market is a validation of our selection. The competition will be more intense and the competitors have a head start. However, considering that the blockchain technology is likely between the Trigger phase and Peak of inflated expectation phase (Gartner emerging technology framework) and that the demand for migrant workers will only accelerate in developed countries due to aging populations, there will be a huge demand for such a blockchain-based system over the next 10-15 years once acceptance kicks in.

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