In any market, transparency and dissemination of information is important, because it enables individuals to make informed decisions about which services to use, and it also helps to make the market as a whole more efficient. In the remittances market, in particular, the total cost might not always be clear to customers as there are a number of variables that go into it: the transaction fee, the exchange rate applied and the margin eventually charged, and the speed of the service, among others.
In principle, all these elements must be captured in the information to the consumer; in practice, this is not always the case. Therefore, combining all these elements to calculate which service is cheapest in a comparable way is difficult for most remittance consumers. In addition, it is difficult to measure improvements in remittance markets, as there is little data on cost and efficiency. For this reason, the World Bank has released this website, which reports comparable remittance price data and service terms.
Currently, the database covers 367 "country corridors" worldwide. The corridors studied flows from 48 remittance sending countries to 105 receiving countries. In most cases, data was captured from the main sending location/area for the corridor in question to the capital city or most populous city in the receiving market.
Data is collected in two ways: (1) By researchers posing as customers and contacting firms within each corridor. Researchers collect data within each corridor over a limited period of time, in order to control for fluctuations in exchange rates and other changes in fee structures. There may also be recollections within the following two weeks to ensure data quality standards are met. (2) In an automated way from APIs and websites of different RSPs.
It should be noted that data this database is intended to serve as a snapshot of a moment in time, and that pricing may vary over time.
Additional details on the methodology used for collecting data are as follows:
- Firms Data is collected for the major service providers in each corridor, including both the primary Money Transfer Operator (MTO) and Banks active in the market, as well as the Post Office when available. Surveyed firms are selected aiming to provide a representative sample of the market in each corridor. Companies surveyed within each corridor are selected to cover the maximum remittance market share possible, aiming at a minimum aggregated market share of 80 percent.
- Amounts: Two amounts are surveyed for each corridor: the local currency equivalent of USD 200, and the local currency equivalent of USD 500. The amounts were set in 2008 and subsequently adjusted to reflect foreign exchange fluctuations in the third quarter of 2009. The local currency amounts were then kept stable to ensure consistency of the price points throughout time. As a result, amounts in local currency may differ from the current USD equivalent.
- Transfer fee: This is the most visible cost component and can differ significantly among market players. This fee usually represents the charge the sender pays at the initiation point, and usually varies with the amount sent, within set bands. In some cases, there may be fees and taxes charged by the recipient country/organization that are not tracked in this database.
- Exchange Rate Margin: An important portion of the remittance cost is the exchange rate spread, which is not quoted in the transfer fee. Even though remittances can be paid in US dollars in some countries, the majority of remittance transactions are paid in local currencies, and, thus, an exchange operation is required. In this database, where remittances are paid in dollars, or where exchange rate information was not provided, this information may not be available. In these cases, the actual total costs might be higher than indicated in the database.
- Product: The database covers different forms of transactions. For each firm the type of product(s) offered was noted within the following categories: door to door, cash to cash, account to account (same bank), account to account (other bank), account to cash, cash to account, cash to account (same bank), credit/debit card service, pre-paid card service, online service, mobile service, USD service, LCU service, EUR service. As of Q2 2016, to better reflect market developments, this category was converted into Payment Instrument to capture the payment means used by the sender to initiate the transaction, categorized as follows: cash, bank account transfer, debit credit and/or prepaid card, mobile money. Similarly, as of Q2 2016, RPW captures the way the transaction is received by the sender under Receiving method, using as categories cash, bank account (either hold at any bank or within the same or a partner bank as the one used by the sender), mobile wallet. When transaction is disbursed in cash, the type of location where money can be picked up is also recorded (agent, bank branch, Post Office, home delivery).
- Access point: As of Q2 2016, RPW captures the type of access point where transaction can be initiated by the sender. This includes agent, bank branch, post office, Internet, mobile phone, call center.
- Speed of transfer: The speed of transfer is the time needed for the remittance to be available for the receiver. The transfer speed is noted for each product. Since the First Quarter 2009 the speed of transfer has been standardized in six broad categories: less than one hour, same-day, next day, 2 days, 3 to 5 days, and 6 days or more.
- Network coverage: Since the Q1 2009 the database also includes, for each company surveyed, a description of the network coverage in the receiving country. This additional variable complements the overall picture for price and convenience of the service offered by each RSP. The following categories were used to describe RSP coverage: nationwide, urban only, rural only, main city, major cities. Since Q2 2016, network coverage is captured both for the sending and receiving networks and ranked as high, medium, low.
The pricing data provided in this database are intended to serve as a snapshot of the cost of remittances on specific dates and time. Actual costs may vary. The World Bank provides no warranty, expressed or implied, as to the accuracy or completeness of the data furnished. The data and information provided herein should not be used as a substitute for actual pricing information that consumers should obtain directly from service providers.