Massimo Cirasino Coordinator for Technical Areas 3-4, GRWG Practice Manager, Finance and Markets Global Practice XVI Global Remittances Working Group Meeting Washington, DC April 16, 2015 The Global Effort in the Remittances Arena Updates from the World Bank
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Massimo Cirasino
Coordinator for Technical Areas 3-4, GRWG
Practice Manager, Finance and Markets Global Practice
XVI Global Remittances Working Group Meeting
Washington, DC
April 16, 2015
The Global Effort in the Remittances Arena
Updates from the World Bank
Key messages
• Entering a new phase towards remittance cost reduction with renewed
commitments and innovative interventions (2015-2020)
• Supporting Post 2015 agenda
• Towards Universal Financial Access 2020
• Global average of remittance cost continues to decline; RPW has picked
indicators of emerging challenges
• Challenges are emerge at a larger scale. Coordinated responses with key
stakeholders in order to address them with balanced solutions
• Results from ongoing Greenback 2.0 and expansion of Greenback 2.0 in
other geographic areas
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Global efforts led by the
World Bank matched with
interventions at the
country level are bringing
down the cost of
remittance services for an
estimated cost savings
of over US$ 62.5 billion
Remittance Prices Worldwide
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Remittance Prices Worldwide - Global Trends
In Q1 2015 the Global Average has declined reaching 7.72%, down from 7.90% last quarter and remaining below 8% for the third consecutive quarter
The International Money Transfer Operator (MTO) Index has reached its lowest average at 8.03%
Global Average and International MTO Index
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The Global Weighted Average has declined again in Q1 2015 after having suffered from an increased in the previous quarter.
In Q1 2015 the Global Weighted Average cost of sending USD 200 was registered at 5.94% - up from the all-time low of 5.71% recorded in Q4 2014 – but still below 6%
Remittance Prices Worldwide - Global Trends
Global Average and Global Weighted Average
5.94%5
Remittance Prices Worldwide: Original 8 Countries –5x5 Objective
Global Average 7.72% - G8 Average 7.19%
The average cost of sendingremittances from G8 countriesdeclined further, reaching a newlifetime low of 7.19%, remainingbelow 8% for the fifth consecutivequarter
Six G8 countries experienced a declinein the average total cost since Q4 2014.Russia and Japan were the onlycountries to experience an increase inthe last quarter
Japan (13.43%) remains the mostexpensive sending country in the G8
France and Germany showed thelargest decreases during the last quarter
Russia remains the cheapest G8sending country and the only one withan average total cost below 5%
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Remittance Prices WorldwideRemittance Sending Countries (Q1 2015)
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Remittance Prices by RSP type
The cost of sending remittances throughBanks continued to decline in the lastyear; from 12.53% in Q1 2014 to 11.42% inQ1 2015
The cost of transferring through PostOffices declined by 0.24 pp in the lastyear; from 5.93% in Q1 2014 to 5.69% inQ1 2015
The cost of sending money through MTOsdecreased by 0.33 pp from 6.69% in Q12014 to 6.36% in Q1 2015
The current costs of sending remittancesthrough MTO are the second lowest in thehistory of RPW
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Remittance Prices Worldwide Remittance Corridors
More than ¾ of the 226 corridors evaluated (76.1%) are below 10%, compared to just over half (53.7%) in 2009, and approximately ¼ of the corridors evaluated (24.3%) are already below the 5% target
117 corridors, or 51.8%, have average total costs that are between 5% and 10%
Five years ago, almost 5% of corridors had an average cost over 20%; today, only 1% do. In Q1 2009, 16% of corridors had an average cost higher than 15%; today, only 5% do