Remittance inflows are expected to grow by 1.2 percent yearly in the five years after the COVID-19 pandemic first broke out, to reach an estimated $745.1 billion by 2025 thanks in part to a wide range of options for sending money.
According to Research and Markets, the remittance sector took a hit as the pandemic ravaged job markets, forced businesses to fold and placed hurdles in sending money across borders.
Last May, the World Bank said remittance flows to low- and middle-income countries shrank by 1.6 percent to $540 billion in 2020 from $548 billion in 2019.
The multilateral lender said such numbers meant that remittances flows remained resilient last year, considering that the decline was smaller than projected.
In the Philippines, the Bangko Sentral ng Pilipinas recorded a 0.8-percent decrease in inflows from overseas Filipino workers, with $33.19 billion in 2020 and $33.47 billion in 2019.
Surpassing 2019 level
In the 10 months to end-October, remittances from overseas Filipinos already reached $28.8 billion, surpassing the $27.6 billion recorded in 2019 before the onslaught of the COVID-19 pandemic.
Also, January-October remittances this year have increased by 5.4 percent from $27.4 billion recorded in the same period of 2020.
Research and Markets said inflows would get a boost from factors such as reduction in remittance costs, rising international migration, improving youth unemployment rate, surging urbanization, rising number of international students and increasing refugee population.
“However, the market growth would be challenged by fluctuating remittance costs by region, de-risking practices and stringent government regulations,” it said.
“A few notable trends may include emergence of fintech platforms, growing demand for mobile payment transactions, surging options of sending money and high pressures to reduce remittance fees on money transfer operators are expected to boost the market in future,” it added.