The remittance industry plays a crucial role in connecting people from different parts of the world, allowing them to send money to their loved ones in other countries. However, one of the major concerns for many people when it comes to sending remittances is the cost involved. In this article, we will take a look at the costs of sending a remittance and how they vary depending on the method of transfer, the country of origin, and the destination country.
According to the World Bank, the global average cost of sending $200 was 7.1% in the first quarter of 2020. However, the cost varies greatly depending on the method of transfer. For example, the average cost of sending a remittance through a bank is higher than that of using an online platform or a mobile app. According to a report by Boston Consulting Group, the average cost of sending $200 through a bank is around 10%, while the cost of using an online platform or a mobile app can be as low as 2%.
The cost of sending a remittance also varies depending on the country of origin and the destination country. According to a report by Bain & Company, the cost of sending a remittance from the United States to Mexico is around 6%, while the cost of sending the same amount from the United States to India is around 9%. This is mainly due to the fact that remittances to developing countries are subject to higher costs due to the lack of infrastructure and the high fees charged by intermediaries.
In recent years, there has been a growing number of remittance startups that are looking to disrupt the traditional remittance industry by offering more affordable and efficient services. Some of the well-known remittance startups include TransferWise, WorldRemit, and Remitly. These startups typically use technology to bypass traditional intermediaries and offer lower costs to customers.
In conclusion, the cost of sending a remittance varies greatly depending on the method of transfer, the country of origin, and the destination country. While the global average cost of sending $200 was 7.1% in the first quarter of 2020, the cost of using an online platform or a mobile app can be as low as 2%. Additionally, remittances to developing countries are subject.