Remittances have formed a crucial aspect for the population of the Philippines as they have relied significantly on the money transferred from OFWs to carry out their day to day tasks. Due to the increase in number of OFWs along with an increase in their basic income, the international remittance market of Philippines is expected to grow at a CAGR of ~% in the coming years from 2015 to 2019. The total transaction volume of remittances has been estimated to reach USD ~ million by the year 2019.

Internet technology has enabled Filipinos to send remittances at the ‘click of a button’ and provided an extremely convenient mode of money transfer across the globe. The increase in internet penetration to 39.4% of the total population has supported the growth of international remittances and will continue to play a major role in the coming five years. Rapid expansion of remittance agents to remote areas will also provide Filipinos with better connectivity to obtain hard cash. This geographic expansion of services will not only lead to an elevation in remittance volume but will also heighten the competition between major players. Intensified competition will in-turn facilitate cost effective remittance services which assist in customer acquisition. Remittances from the US have held a major share of ~% during 2014 and have dominated the remittance market during the years 2009-2014. The presence of large number of OFWs and high exchange rate of USD to PHP has led to the highest amount of remittances from the US to Philippines. Other major flow corridors include Saudi Arabia, UAE, the UK and Singapore. Despite of higher volume of transactions from the US, average cash remittances per OFW was witnessed as the highest for Australia. An OFW residing in Australia made an average cash remittance transaction of over PHP 120 thousand and over PHP 100 thousand for male and females respectively in the year 2014. On the other hand, male and female OFWs processed an average transaction per OFW of PHP 113 thousand and PHP 70 thousand respectively.

Banks, which have played a major role in international remittance transactions, have expanded their network through strategic partnerships with local agents to progress banking penetration amongst the Filipino population. In the coming years, this market will likely witness stiff competition which could lead to transaction fee cuts. Banco de Oro was the major bank for international inbound remittance in the year 2014 and was followed by the Bank of Philippine Islands. Banco de Oro has focused on alliances with remittance service providers to increase its share in the market.

Furthermore, Money Transfer Organizations such as LBC, Western Union and many more have acted as a crucial link for Filipinos to gain financial access. These companies have established their centers across multiple regions to aid easy access of remittances and bill payments. Filipinos have chosen their remittance service providers on the basis of transaction fees, connectivity and security of services provided. With the presence of a large customer base, remittance companies have utilized this opportunity to improve services and increase customer acquisition. Also, many remittance service providers have formed alliances with other financial institutions to enable smoother mode of transactions.

Historically, natural calamities have highlighted the Philippines’ reliance on remittances to fund domestic consumption, with the affected families resorting to their relatives working abroad for help. This trend is likely to continue in the future as well. Additionally, owing to the current employment scenario and the failure of the Philippine government in creating more jobs at home, Filipinos will continue to travel abroad for better employment opportunities which will in turn drive financial transfers across international borders of the country.
According to an industry veteran, “the remittances to Philippines have grown in the past decade and will continue to rise significantly in the future with the rise in OFWs, however, remittance service providers might face hurdles in revenue generation due to reduction in transactions fees and increased spending on marketing and branding activities. The future years are expected to witness an increase in remittances majorly from the US and the Middle East.”

“Remittances have been essential to provide financial resources for Filipinos to pay bills and perform basic daily operations. Customized, fast and cost effective remittance services will likely be the key to en-capture the Filipino market. The country has already been considered to contain one of the highest remittance transactions in the world and will provide a platform for further growth of the existing players. Moreover, mobile money will act as the most crucial variable in the Philippines remittance market”, is according to the Research Analyst, Ken Research.

The report titled “Philippines Domestic and International Money Transfer Industry Outlook to 2019” provides detailed overview on the money transfer market. This report helps reader to identify the ongoing trends in the industry and anticipated growth in future depending upon changing industry dynamics in coming years. The report will help industry consultants, remittance service providers (MTOs), banks, local agents and other stakeholders to align their market centric strategies according to ongoing and expected trends in the future.

Key Topics Covered in the Report:
Remittance Market
- Market Size by Revenue for
o International Remittances
o Domestic Remittances
o Bill Payments
- Market Segmentation by
o Remittance Channels
o Types of Services
o Major Flow Corridors
- Trends and Development
- SWOT
- Competition, Service Offerings, Strengths and Weaknesses and Market Share of Major Players
- Mobile Money Transfers
- Growth Drivers
- Future Outlook
- Analyst Recommendation
- Macro Economic Parameters

Key Services Mentioned in the Report
International Remittance
Domestic Remittance
Bill Payments
Companies Covered in the Report
Banco de Oro
Bank of Philippines Islands
Philippine National Bank
Wells Fargo
Palawan Pawnshop
LBC Express
Cebuana Lhuilier
Western Union
M Lhuillier
Money Gram
iRemit
Xoom
Globe GCash
Smart Money


Related Reports:
India Domestic Remittance, M-Wallet and Bill Payment Market Outlook to 2018 - Driven By Government Support and Rising Banked Population
Malaysia Remittance Industry Outlook to 2019 - Driven By Increasing International and Domestic Migration
KSA International Outbound Remittance Industry Outlook to 2018 - Rising Remittances to India to Fuel Growth

Contact:
Ken Research
Ankur Gupta, Head Marketing & Communications
[email protected]
+91-9015378249