Eurogiro News
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Migrant remittances delivered through postal
networks in Asia feature impressive growth rates
A recent landmark publication of the International Fund for Agricultural Development (IFAD) and World Bank
highlighted the fact that post offices are now the second-most used channel in Asia for remittances
It is estimated that the market share is
around 4% of the total flow of US$ 260
billion, whilst the volume of remittance
transactions is over 50 million per year.
With over 350,000 post offices in Asia,
and more than 200,000 offices located
in rural areas, the postal networks play
a valuable and vital role in rural outreach.
The growth in the remittance business
leads the way in the transformation of
several postal operators and, in some
cases, revenues from international remit-
tances are already higher than from
traditional letter mailing services.
Different business models for remittances
are emerging. In particular, strategies in
partnership building, multi channeling, and
innovative products using state-of-the-art
technologies appear to produce ‘quick-wins’
for postal operators. Examples can be seen
in, for example, Indonesia, Malaysia, India,
Kazakhstan, Kyrgyz Republic and Azerbai-
jan and are very promising. This approach
helps to create a basis for further expansion
towards a competitive operation in financial
services, enhancing outreach of access to
financial inclusion.
Also, Laos, Vietnam, Papua New Guinea
and others have already progressed with
implementing strategies in this direction.
In general, postal financial services are, in
Asia, the single largest revenue component
for Posts. This is clearly the case in China
and India. The roadmap of development in
postal financial inclusion in Asia also faces
increasing challenges. In urban areas,
banks and other financial service providers
are omnipresent and often provide niche
segments for postal networks. In rural
areas mobile communications technology
is practically everywhere. In this context,
the example of Bangladesh in moving for-
ward its mobile money product is to be com-
mended. The market for mobile financial
services features strong growth prospects
in Asia, and the question is whether - and
how - physical networks of postal operators
can plug in to the opportunities of mobile
money.
The IFAD Financing Facility for Remittances
(FFR) is a multi-donor initiative working to
d
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South Asia
Remittances 2012 (US$ million)
$113,487
Migration ouflows 2010
27,948,723
South-East Asia
Remittances 2012 (US$ million)
$47,992
Migration ouflows 2010
12,868,837
East Asia
Remittances 2012 (US$ million)
$85,627
Migration ouflows 2010
12,311,325
Central Asia
Remittances 2012 (US$ million)
$10,366
Migration ouflows 2010
3,628,107
The Pacific
Remittances 2012 (US$ million)
$553
Migration ouflows 2010
467,244
Asia and the Pacific
Remittances 2012 (US$ million)
$257,974
Migration ouflows 2010
57,224,236
Sources: World Bank, Remittance Inflows by Country, November 2012.
IMF, World Economic Outlook Database, Gross Domestic Product Current Prices in US Dollars, 2012.
World Bank, Bilateral Migration Matrix, 2010.