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Visa (V) Emphasizes Digital Remittances Adoption for the Future
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Visa Inc. (V - Free Report) revealed that digital remittances are becoming the most sought-after method of payments internationally in its “Money Travels: 2023 Digital Remittances Adoption” research report. This is expected to create huge opportunities for companies providing money transfer services.
Visa surveyed more than 14,000 remittance senders and receivers across 10 countries on “Digital Remittances Adoption”. Approximately 53% of surveyed consumers are shifting to digital apps for receiving and sending payments around the world.
Visa has continuously been innovating and promoting inclusivity by launching products, such as Visa Direct and Visa Business Solutions. Its mission is to be at the forefront of digitizing payments, enabling cross-border payments to be affordable, and less time-consuming for senders and receivers.
In North America, 60-70% of the surveyed people have used an application-based digital payment method to transfer money internationally, whereas only 10-15% of people relied on money orders, cash and cheques.
In the United Arab Emirates and Saudi Arabia, digital apps are the preferred methods of remitting money for 65% and 69% of surveyed people, respectively. In France and Poland, the percentage of people using digital methods for money transfers stood at 62-67%.
This highlights the urgency of businesses in the money remittance space to innovate and adapt to changing times, as the future of digital money transfer is inevitable.
Why the Rush?
The answer to this lies in the certainty and security of digital transactions. Traditional modes of money transfer expose one to unexpected delays and higher fees charged by banks, while the digital method makes the process easy and more secure.
Visa Direct, Visa’s real-time payments network, facilitates fast delivery of funds to more than 5 billion cardholders spread across more than 180 countries on a real-time basis. Innovative products like this will enable Visa to simplify cross-border payments and promote financial inclusion.
Hiccups
While digital payments may make the money transfer experience hassle-free and reduce the number of days for settlement of transactions, it has some pain points that need to be addressed by companies. High fees and issues with calculating exchange rates continued to bother remitters. In the United Arab Emirates, 38% of the consumers reported high fees charged on the send side and the same for Singapore stood at 37%.
Growing Competition
Other players in the remittance space are Euronet Worldwide (EEFT - Free Report) , MoneyGram and Western Union Co. (WU - Free Report) .
Euronet Worldwide’s money transfer segment accounted for 42% of its total revenues in 2022. EEFT has been expanding its digital media content and digital presence through its mobile application and real-money transfer.com as digital transactions are on the rise. Its Ria Money Transfer subsidiary is bolstering its remittance service capabilities.
MoneyGram is a leading global financial technology company providing innovative services around the world. The company is partnering with other companies to boost its cross-border money transfer business, which will boost its bottom line.
Western Union boasts a solid digital arm and is focused on strengthening its position in the global cross-border payments market. Its focus on the remittance market of the Indo-Pacific region will likely be a major positive.
Image: Bigstock
Visa (V) Emphasizes Digital Remittances Adoption for the Future
Visa Inc. (V - Free Report) revealed that digital remittances are becoming the most sought-after method of payments internationally in its “Money Travels: 2023 Digital Remittances Adoption” research report. This is expected to create huge opportunities for companies providing money transfer services.
Visa surveyed more than 14,000 remittance senders and receivers across 10 countries on “Digital Remittances Adoption”. Approximately 53% of surveyed consumers are shifting to digital apps for receiving and sending payments around the world.
Visa has continuously been innovating and promoting inclusivity by launching products, such as Visa Direct and Visa Business Solutions. Its mission is to be at the forefront of digitizing payments, enabling cross-border payments to be affordable, and less time-consuming for senders and receivers.
In North America, 60-70% of the surveyed people have used an application-based digital payment method to transfer money internationally, whereas only 10-15% of people relied on money orders, cash and cheques.
In the United Arab Emirates and Saudi Arabia, digital apps are the preferred methods of remitting money for 65% and 69% of surveyed people, respectively. In France and Poland, the percentage of people using digital methods for money transfers stood at 62-67%.
This highlights the urgency of businesses in the money remittance space to innovate and adapt to changing times, as the future of digital money transfer is inevitable.
Why the Rush?
The answer to this lies in the certainty and security of digital transactions. Traditional modes of money transfer expose one to unexpected delays and higher fees charged by banks, while the digital method makes the process easy and more secure.
Visa Direct, Visa’s real-time payments network, facilitates fast delivery of funds to more than 5 billion cardholders spread across more than 180 countries on a real-time basis. Innovative products like this will enable Visa to simplify cross-border payments and promote financial inclusion.
Hiccups
While digital payments may make the money transfer experience hassle-free and reduce the number of days for settlement of transactions, it has some pain points that need to be addressed by companies. High fees and issues with calculating exchange rates continued to bother remitters. In the United Arab Emirates, 38% of the consumers reported high fees charged on the send side and the same for Singapore stood at 37%.
Growing Competition
Other players in the remittance space are Euronet Worldwide (EEFT - Free Report) , MoneyGram and Western Union Co. (WU - Free Report) .
Euronet Worldwide’s money transfer segment accounted for 42% of its total revenues in 2022. EEFT has been expanding its digital media content and digital presence through its mobile application and real-money transfer.com as digital transactions are on the rise. Its Ria Money Transfer subsidiary is bolstering its remittance service capabilities.
MoneyGram is a leading global financial technology company providing innovative services around the world. The company is partnering with other companies to boost its cross-border money transfer business, which will boost its bottom line.
Western Union boasts a solid digital arm and is focused on strengthening its position in the global cross-border payments market. Its focus on the remittance market of the Indo-Pacific region will likely be a major positive.
Zacks Rank & Price Performance
Visa currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Visa have jumped 6.8% year to date compared with the industry’s growth of 2.3%.
Image Source: Zacks Investment Research