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How Modern Technologies Have Evolved The Remittance Industry – A Brief Overview

How Modern Technologies Have Evolved The Remittance Industry – A Brief Overview

01 Aug 2022


Many families and economies globally have benefited from the remittance industry. According to the World Bank, international remittances were anticipated to be $689 billion in 2018, up from $633 billion. Pakistan has notably maintained its status as one of the world's leading recipients of remittances. Thanks to technological advancements, it is now simple to send money to Pakistan online.

Undoubtedly, the remittance industry is expanding at an exponential rate. People find it easier to move to other nations to seek better work prospects due to increased globalisation, smoother visa processes, and improved connections among countries. Pakistan is no exception in this regard, with massive diasporas sending remittances back home from around the world.

The remittance sector has seen a substantial transformation in technological advances. Let's look at how this works.

Understanding The Remittance Industry 

A money transfer from one party to another is known as a remittance. However, the term is now most usually used to refer to a sum of money sent home to a family by a person working abroad.

The term remit is derived from remitter, meaning to return something. Foreign Pakistani workers send money to Pakistan to their family members back home using different methods. The most common way of remittance is via a bank's electronic payment system or a money transfer service like ACE Money Transfer. The users of these services have to pay specific fees for using the services where every provider has a special price. However, ACE Money Transfer allows its customers to enjoy absolutely Fee-Free transfers on new signup or special occasions while charging the lowest transfer fees typically on regular days.

A typical transfer can take as little as ten minutes to reach its intended recipient. A money transfer to Pakistan using ACE’s services swiftly reaches the destination within 7 seconds, and there is no additional fee for it.

Pakistan Remittance Statistics

In the current fiscal year 2021-22, Pakistan is expected to receive a record $6300.00 million in remittance inflows by the end of the current quarter. It includes over nine million abroad workers remitting $15.8 billion in the first half, which ended on December 31, 2021.

According to the latest data issued by Pakistan's central bank, the State Bank of Pakistan (SBP), non-resident Pakistanis made 11.3% more money transfers to Pakistan from July to December this year than they did the previous year.

In 2021, remittances climbed a 3.4% monthly rise throughout the year. A persistent growing remittances trend has provided much-needed support and relief to Pakistan's economy.

Modern Technology And The Remittance Industry

Technology For Mobile Money

Remittance technology faced another revolution when internet access was enabled on mobile phones. Communication is vital in the remittance industry, and mobile phones help to bridge the gap between senders and receivers. 

Most banks now provide mobile banking with secure remittance service options, making it easier to send money to Pakistan from Germany or other countries. You will receive a short text message when money is debited from or credited to your account.

Thanks to mobile phones and SMS alerts, tracking refunds and errors in money transfers have also become more manageable. The 5G internet services launch is expected to boost the quality of mobile services accessible to the remittance business, making money transfers to Pakistan more accessible.

Wallet Credit

It is the most recent technology for receiving money through cross-border remittances. Mobile wallets have eased the process of money transfer to Pakistan from abroad. However, this mode is not yet available in all countries. The ability to use the wallet at merchants or a cash-out facility is the main focus of this payment mode. 

Money Transfer Apps. 

Previously, expats would go to banks to send money back to their loved ones. With money transfer apps, technology's greatest strength has now benefited everyone. Money transfer apps are an advanced way of sending and receiving remittances. Peer-to-peer apps allow you to transfer money from one person to another quickly and securely. 

Money transfer apps like ACE’s digital mobile application make payments easier and allow you to link your credit card or bank account via a digital wallet. Electronic transactions and payments can be completed with a few taps on a mobile device.

This new technology has been most beneficial for people who want to make an online money transfer to Pakistan. The best money transfer apps have high app store ratings, assist app shoppers in sending money safely, and have no hidden fees. They also meet consumer needs such as international payments, social options, virtual wallet offerings, etc.

How Is Technology Changing The Remittance Industry?

The rise of mobile and the digitisation of money are the two most significant opportunities that are altering the way to manage and move money. Even in developing countries, using mobile phones for various purposes is common. 

Mobile phones and Internet technology can help individuals worldwide reduce the cost and effort of sending money home. People who live in a country or city use essential cellular services such as SMS to initiate, send, and receive payments to family members who live in another. Mobile technology removes these barriers, making remittances more convenient, secure, and cost-effective.

Customers, for example, can easily and quickly make an online money transfer to Pakistan with a swipe on their device’s screen. To accommodate clients' changing preferences in the pandemic, remittance providers have increasingly offered digital apps and partnered with FinTechs.

Secure Money Transfers

Modern technology also demonstrates convenience and peace of mind when making secure money transfers at any time and location, indicating that users receive SMS alerts when money has arrived. Besides, customers can constantly track their transactions throughout the process, from initiation to completion.

ACE Money Transfer further enhances its customers’ remittance experience by ensuring completely secure transfers supported with end-to-end data encryption. Such unbreakable security protocols provide great peace of mind to the customers with added layers of protection and privacy.

Another significant advancement has been the digitisation of money. Everyone faces a profound shift in how people shop, how merchants sell, and how people interact with financial institutions. 

Digital remittances can help people make their lives easier by allowing them to do what they want with their money.

Reduced Remittance Cost And Transfer Time 

Technological developments have helped people stay connected to their families while living overseas. Global diasporas can instantly transfer funds to their families back home from anywhere worldwide. Modern money transfer methods via digital wallets, mobile apps, credit and debit card payments, online portals, etc., have significantly reduced the transaction processing time. The beneficiaries can receive money from abroad within minutes through internet-based remittance solutions offered by regulated service providers such as ACE Money Transfer.

Traditionally, the costs of securely organising and transferring money globally have been relatively high. The rise in digitisation and automation reduced remittance cost and transfer time, and increased adoption of banking and financial services are driving the growth of the digital remittance market with the help of the internet.

The workflow and all processes in the international money transfer industry have been altered by modern technology. Customers now have many options, ranging from apps to mobile money wallets and virtual currencies, compared to their humble beginnings, when transactions could only be carried out through static website portals or a physical presence at a bank or money remittance firms. Modern innovation has made sending money abroad convenient.

Final Thoughts 

Every few decades, the international remittance industry undergoes a technological shift. Whereas the online world, international mobile banking, online payments, fintech services, and other related technologies have proven very useful, only time will tell what the future holds. But, with technology advancing quickly, the global remittance industry's future is bright, with more advancements yet to come. 


 


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