Event Summary
Market Opportunity
One of, if not the biggest single profit opportunities in current financial services is money remittance.
Why:
- despite forecasts by Developing Market Associates that fees for remittance have dropped from around 11% to 5% of the
value remitted this is still a very high figure leaving plenty of scope for new, leaner more efficient entrants.
- a significant proportion of the market, many would claim, is still dominated by services using outdated technology
and expensive infrastructures.
With the launch of many new entrants offering mobile money remittances services, card based remittance and even new web
based banks dedicated to money remittance the market is undergoing probably its greatest period ever of change and increased
competition.
The key question is: will the current organisations offering services in this area be still around in 5 years or will
they have been surpassed or morphed to offering new products and services?
Market Size
According to the World Bank the current remittances market is worth $318bn, with informal transactions taking the total
to close to $600bn. They estimate that by 2030 the value will grow to a massive $72trillion. Can any financial service
provider afford to ignore a market of this size? Can you?
There are 175 million people who live outside their country of origin according to the UN potentially looking to transfer
funds back home.
Remittances are for many emerging countries the second largest external flow of funds after foreign direct investment.
Even in the UK the Office of Statistics from the latest Labour Force survey reveal that an influx of Eastern European
workers has bumped up the number of foreigners in the UK workforce by 75% in the past six years, from 864,000 in 2001
to two million people. This is equivalent to one in 14 of the total working population.
The Myth – not all migrant workers are low paid:
The number of college-educated migrants in rich Western countries rose 69 percent from 1990 to 2000, according to a World
Bank where as the number of less-educated migrants rose 31 percent based on movement to 20 nations, including the United
States, Canada, Australia and most of Western Europe, and included people who went to college after migrating as children.
Of 52 million migrant workers in those countries, 36 percent had some college education, up from 31 percent a decade before.
Of those migrants leaving one rich country to look for a job in another, the number with some college education rose to 30
percent. The parallel movement of less-skilled workers fell to 8 percent. Migrants are thus increasingly well paid, doing
professional jobs and thus are often looking to transfer significant sums on a regular basis back to their home countries.
Mobile and Cards Remittances – Event Focus
We will be focusing on two key remittance solutions Mobile and Card –
Why: this will be the future, avoiding the old infrastructures and utilising the new superhighways of information technology.
Mobile Money Transfers
Juniper research state that their will be 100 million users by 2013 using a mobile phones for money remittance.
Hardly surprising if we consider that there are 2.8 billion mobile phone users worldwide, over one million connections
daily (EDC-GSMA Mobile Financial Services Survey 2007), compared to approximately only 0.5 million bank branches globally
with around 1.4 million ATM's. These users will be generating revenues according to Juniper of over $5 billion by 2013,
and by 2030 could reach a value of $72 trillion, an astronomical sum.
Many markets are even technology leaping and jumping straight from no Internet or broadband to mobile phone delivered
web access and broad financial services..
At this stage there is a lack of regulation and the development of it will shape the future market.
There are major differences between how handsets, operators and payment providers all believe the income should be split.
There are also a myriad of technologies becoming available, many claiming patent protection.
So, which ones should a partner adopt, what is the correct route to market, what are challenges?
All these and other questions will be addressed.
Card Remittance:
By 2010 PSE have estimated that open loop prepaid card remittances in Europe alone will be worth € 3,847m. New entrants
to the market in the last few years have started to target niche audiences like Chinese and Polish population. Will this work?
How do they reach their customers, how do they handle the KYC? All of these and other questions will be addressed
through a case study based approach at this one day event.
Why Should you Attend
Because real business case studies will be presented helping you answer some of the key questions including:
- How do you build a profitable business in this complex and changing payments ecosystem?
- How are you going to get cash in and cash out?
- What are the operational implications of complying with local regulations?
- What are the opportunities for MNOs, banks, MFIs and MTNs?
- How do you handle KYC?
- How do they partner?
- How do you launch successfully, build a brand, win customers, boost ARPU and minimise churn?
- What can I learn from other global examples?
Delegates coming from:
Main brands looking to enter money remittance
Potential distribution and marketing partners
Money transfer operators
Banks
National and government organisations
Telecoms operators
Academics
Research organisations
Technology provider
Exchange houses
Lawyers and regulators
