Remittance Industry Slows, But Innovates With Faster, Cheaper Services
The global money transfer industry experienced a slowdown in consumer revenues during the third quarter of 2022. Despite this, companies are innovating to offer faster, more efficient services.
Leading money transfer players like Western Union and Remitly faced challenges. Western Union saw a 12% decline in digital money transfer revenues and a 20% decrease in transactions. Remitly, however, saw a 49% increase in active quarterly customers to 3.8 million. Meanwhile, Euronet reported a 3% growth in its money transfer segment, with double-digit transaction growth in the US and internationally-initiated transfers.
Macroeconomic factors, such as the Russia-Ukraine war and currency fluctuations, have impacted the industry. Despite these headwinds, companies are competing on speed and payout capabilities. Money transfer companies have improved these aspects by using stablecoin technology and blockchain programmability. This allows liquidity to be moved worldwide within minutes instead of days, reducing costs and increasing efficiency. MoneyGram's total growth was 1%, with its online offering increasing by 13%. Intermex's revenue growth was driven by an 8.8% increase in active agents, an 11.4% rise in active unique customers, and a 16% increase in money transfer transactions.
While the money transfer industry faces slowing growth and macroeconomic challenges, companies are innovating to offer faster, more efficient services. The use of stablecoin technology and blockchain programmability is transforming the sector, benefiting both senders and receivers of money transfers.
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