’lRemittances to Latin America
and the Caribbean in 2018
I.

Manuel Orozco
Laura Porras
Julia Yansura
April 2019
Migration, Remittances, andDevelopment
www.thedialogue.org

Introduction and General Trends

Family remittances to Latin America and the Caribbean reached $85 billion in 2018, an
important financial flow and a critical source of support for many households in theregion. Each year, the Inter-American Dialogue analyzes remittances to the region,
identifying areas of growth and new trends that are impacting how people send andreceive money. The data presented draws from official sources, such as Central Banks,
as well as from original survey data with remittance senders and recipients. Taken
together, they shed light on the complex, deep, and very dynamic connections that
migrants maintain with their home countries.
Remittances to the Latin American and Caribbean region are on the rise. They grew
10.2% in 2018, up from 8.2% in 2017 and 7.9% in 2016. Moreover, the strong growth levels
for remittances stand in stark contrast to the sluggish 1.9% economic growth rate forthe region. The countries with the highest remittance growth rates in 2018 included
Haiti, Colombia, Guatemala, and Brazil.

Table 1: Family Remittances to Latin America and the Caribbean in 2018 (USD)

Countries
Bolivia
BrazilColombia
Costa Rica*
Dominican Republic
Ecuador*El Salvador
GuatemalaHaiti*
Honduras*
Jamaica
MexicoNicaragua
Panama*Paraguay*
Peru
Total selected
countries
Venezuela**2018 Remittances(,000,000 USD)
1,370
2,565
6,339
531
6,494
3,030
5,469
9,288
3,324
4,751
2,346
33,470
1,501
457
569
3,225
84,6503,400

Remittance Growth
2016
2017
2018e
2%
7%
-1.6%
9%
-3%
11.5%
5%
13%
15.3%
0%
3%
-6.0%
6%
12%
9.8%
9%
9%
6.7%
7%
10%
8.5%
14%
14%
13.4%
7%
20%
17.2%
5%
12%
10.4%
3%
1%
1.8%
9%
12%
10.5%
6%
10%
7.9%
-10%
4%
2.9%
19%
7%
-3.0%
6%
6%
5.7%
7.9%
-

8.2%
-

10.2%
-

GDP
Growth
4.5%
1.2%
2.7%
2.7%
5.8%
1.0%
2.8%
2.7%
1.6%
3.6%
1.7%
2.1%
-3.8%
4.0%
4.0%
3.9%

Remittances /
GDP
3%
0%
2%
1%
8%
3%
21%
12%
39%
20%
16%
3%
11%
1%
1%
1%

1.9%
-18%

2%
1%

Source: Central Bank Data and INEC data for Panama; * estimates are marked and use most recent Central Bank data as of April 3, 2019;** Venezuela 2018 remittance data is Inter-American Dialogue estimate based on survey data; previous years are unavailable. For GDP
growth and Remittances GDP, Inter-American Dialogue estimates based on World Bank figures for GDP and economic growth.

While the drivers of remittance growth vary by country, some key trends include increases in the size of the averageremittance, new migration flows to the United States, and rising intra-regional migration mostly related to politicalinstability. At the same time, the ways that people are sending money are evolving as the marketplace for moneytransfers becomes increasingly competitive and digitalized. Because migrants who send through digital channels havedifferent sending behaviors, digital participation in the marketplace also affects overall growth.
Among the key findings of this report,
•
•
•

•

•
•

•

In the case of Mexico, remittances are growing though net migration is declining. This is in large part due toincreases in the principal sent and to increases in the percentage of Mexicans who are sending remittances.
Haiti was the country with the largest remittance growth in 2018, with noteworthy growth in the Chile-Haiti
remittances corridor.
According to 2019 estimates by the Inter-American Dialogue, there are roughly 3 million Venezuelan migrants
worldwide who sent $3.4 billion in remittances in 2018. Given the difficulties in sending money to Venezuela
and the very profound issues related to currency devaluation, in-kind remittances play an important role as
well.
In 2018, Colombia received $6.3 billion in remittances. This is the second year in the row of strong remittance
growth, at 15%. At the same time, the Spain-Colombia remittance corridor has substantially decreased while
remittances from other Latin American countries to Colombia have gained prominence. Remittances to
Venezuelans in Colombia may also explain this growth, as well as senders using Colombia as a mid-point inorder to reach Venezuelan recipients.1
Intra-regional remittance growth was a major trend in 2018. Three countries that are witness to theseincreases are Panama, Chile, and Costa Rica, all of which have seen growth in outbound remittances.
While cash-to-cash remains important, the use of digital transfers has increased substantially in 2018. For
example, at least two million out of seven million monthly transfers to Mexico are currently done throughdigital-based channels using online or mobile applications. These developments may be part of a larger trendof migrants using new technologies to stay connected to their home country; for example, 83% of migrants
use WhatsApp to stay connected with family and friends back home.
The three largest remittance payment markets in the region, Mexico, Guatemala and Colombia, illustrate theimpressive growth of digital transfers. In terms of payout method, digital remittances represent an estimated
33%, 34% and 46% of these markets as of 2018.

This report is organized into three main sections. The first presents country profiles on remittance growth for 2018,seeking to explain growth in specific countries and regions. The next section presents new trends in intraregionalmigration and remittances, which have played a particularly important role in 2018. The report concludes by looking
at technology and competition in the money transfer industry.

1

Based on anecdotal evidence from surveys and from media sources. See, for example,
https://www.dw.com/es/c%C3%BAcuta-el-cajero-autom%C3%A1tico-de-venezuela/a-42470925.
Remittances to Latin America and the Caribbean in 2018

2

II.

Country Profiles for Remittance Growth

In the following section, we present country-specific profiles for Mexico, Haiti, Venezuela and Colombia, as well as aregional analysis for Central America. These case studies shed greater light on countries of special interest in terms of
their size, growth, or changing dynamics in 2018.

Mexico2
Mexico represents almost 40% of total remittances flows to the Latin American and Caribbean region. In 2018, Mexico
registered double-digit remittance growth for the second consecutive year. The 10.5% remittance growth reported in2018 comes on the heels of several years of strong growth, 12% in 2017 and 9% in 2016 (See Graphic 1). Remittances to
Mexico reached $33.5 billion in 2018 and 94% 3 of remittances entering Mexico came from the United States.
Graphic 1: Remittance Flows to Mexico and Year-Over-Year GrowthBillions

33.47

14.00%
12.00%

32
30.29

10.00%

30

8.00%
28

26.99

26
24

6.00%
4.00%

24.78

2.00%

23.65
22.80

22.44

0.00%

22.30

22

-2.00%

20-4.00%
2011

2012

Source: Mexican Central Bank, 2019.

2013

2014

2015

2016

2017

2018

Total remittances

The growth in remittances to Mexico seems a bit counterintuitive since Mexican migration to the US has been
decreasing since 2014. In this regard, trends in remittance-sending behavior, rather than new migration, help explainincrease in remittances sent back home.
Diverse factors may be influencing this growth, impacting increases in principal sent, frequency, or the percentage of
migrants currently sending remittances. A root cause for these changes may be the response of migrants to hardline
US immigration policies that may encourage them to stay in the US and to send more remittances back home, fearing
deportation.4 To these we add a low unemployment rate among Mexicans, some as a result of their willingness torelocate within the U.S. and increases in the percentage of the Mexican migrant population sending money to theirfamilies or for saving purposes.

2This section also benefitted from research and analysis by Paulina Ortega of the Inter-American Dialogue.
See Paulina Ortega and Manuel Orozco, “Remittance Flows from the U.S. to Mexico at the State Level: Drivers andTrends,” Remittance Industry Observatory – Inter-American Dialogue, November 2018. Available athttps://www.thedialogue.org/wp-content/uploads/2018/12/Mexico_Final_Blog.pdf
4
See Orozco, Porras and Yansura, “The Continued Growth of Family Remittances to Latin America and the Caribbean
in 2015,” Inter-American Dialogue, 2016 as well as the RIO Data Release for November 2018.
3

Remittances to Latin America and the Caribbean in 20183

HaitiRemittances to Haiti have experienced strong growth in recent years, reaching $3.3 billion in 2018. This represents 17%
growth for 2018, following 20% growth for 2017. Among the Latin American and Caribbean countries included in thisstudy, Haiti is the country with the largest remittance growth and the country for which remittances represent thelargest portion of GDP (See Table 1).
Haitian migration is closely linked with state fragility and poor performance.5 As of 2017, the largest Haitian migrant
populations are in the United States, the Dominican Republic, Canada and France (See Graphic 2). New migration
corridors have also developed in recent years. After the 2010 earthquake, people who initially migrated to Brazil havesubsequently been moving to Chile. There were less than 5,000 Haitians in Chile in 2010, but the number has increased
exponentially to an estimated 73,000 in 2017. Thus, the increase in Haitian remittances is predominantly the result of asignificant outflow of migration to South America, Canada, and the United States.
Remittances to Haiti come from Canada, Chile, the Dominican Republic, France, and the United States, among othercountries, following many of the migration corridors previously noted. According to data from the Chilean Central
Bank, Haiti was among the top five destinations of outbound remittances in 2016. Moreover, the growth ofremittances from 2017 to 2018 (See Table 1), reflects an increase of more than 100,000 migrants making transfers from
Chile to Haiti. 6 The table below provides additional detail on Haitian migrant populations in key countries ofdestination, as well as estimates for remittance flows in these same corridors.

1995

2000

2005

2010

2015

2017

326,669

50,00050,14456,437
63,87974,96988,502

225,393
26,253
27,102
27,95067,07868,72375,61675,467

36
41
45
37
28

53,63073,09838,27145,29253,39066,504
80,100137,000
137,000

187,210
207,931
228,652
271,273
311,969
329,281336,729

429,964
491,7721990

570,290649,941
671,499

Graphic 2: Haitian Migrant Populations Around the World, 1990-2017

CANADACHILE

DOMINICAN
REPUBLIC

FRANCEU.S.

REST OF THE
WORLD

Source: UN/DESA, 2017 and authors’ estimates from interviews and press sources.

5

For more discussion of this topic, see Manuel Orozco, “Latin American and Caribbean Migration from Weak andFailing States,” Inter-American Dialogue, November 2018.
6
According to the Chilean National Statistics Institute, there were 179,000 Haitians in Chile as of December 31, 2018.
Remittances to Latin America and the Caribbean in 20184

Table 2: Haitian Migration and Remittances to Selected Countries (2017)

Migrant Population Stocks

Remittances:
Estimated
flows to Haiti(2017)Country ofresidence

1990

1995

2000

2005

2010

2015

2017

Canada38,27145,29253,39066,504

80,100137,000

137,000$258,930,000

36

41

45

37

28

53,63073,098$86,793,025

Dominican
Republic

187,210

207,931

228,652

271,273

311,969

329,281336,729$271,538,265

France26,253

27,102

27,95067,07868,72375,61675,467$190,176,840

U.S.

225,393

326,669

429,964

491,772

570,290649,941

671,499$1,269,133,110

Other

50,14456,437

63,87974,96988,50250,000$88,200,000

World
Total

527,307663,472

803,880

971,633

1,119,612

1,378,325*$2,164,771,241

Chile

1,245,468

Source: UN/DESA, 2017. Authors’ estimates from interviews and press sources. *Differences between Central Bank Data
(Table 1) and this table relate to research that shows that up to 20% of transfers recorded are not family remittances, butrather business transactions.
The trend of increased Haitian migration to many of these countries has continued in 2018. For example, the populationof Haitians in Chile has grown over 150%, with corresponding growth in remittances sent (see section on Chile on Pg.
14). The table below presents the results of a 2018 survey of Haitians in Chile conducted by the Inter-American Dialogue.
According to the Chilean Statistical Institute,7 there are 179,338 Haitians in Chile as of 2018; drawing from survey data,
we estimate they are sending an approximate of US$170 million to Haiti as of 2018.
Table 3: Haitian Migrants in Chile and Remittance Sending Behavior

Remittances

Haitians
in Chile

Average
Remittance(USD)

Average$107.5

9.6
times/year

Frequency

Average Cost

Sending Method

In
USD

As %

Agencies

Travelers

Bank

CellphoneInternet

$4.99

5.7%

98.0%

0.0%

2.0%

0.0%

0.0%

Source: Inter-American Dialogue survey of 102 Haitians in Chile.
The same study found that Haitian migrants in Chile have been in the country a little under two years, on average. Theiraverage age is 30 years old, and 86% are male. With regards to their educational profile, 76% have a high school diploma
or higher, and 23% have at least some university education.

7

Chilean National Statistics Institute, estimate as per December 31, 2018.

Remittances to Latin America and the Caribbean in 2018

5

Venezuela
Venezuela’s political and economic situation has become untenable. Although many hoped that Guaido’s claim to thepresidency, backed by more than 60 countries worldwide, would finally bring relief, change has proven to be elusive.
Meanwhile, millions of Venezuelans have fled the country. 8 The United Nations currently places the number ofVenezuelan migrants at an estimated 3 million. This number may be higher and has been constantly rising for the past
10 years as country conditions deteriorate. Venezuelan migrants in Colombia, living in Bogota and Cucuta, are an
example of the blurred lines between refugee and migrant. They continue to send money home, even amidst a severe
situation of vulnerability. Hundreds of thousands of Venezuelans have crossed the Colombian border through places
like Cucuta. Cucuta is a transit location where Venezuelans stay temporarily whereas Bogota is a destination for many. 9
Meanwhile, Venezuelan migrants abroad are trying to help family back home through cash or in-kind remittances,often through very limited and informal sending mechanisms, the only that are currently available to them. According
to 2019 estimates by the Inter-American Dialogue, the roughly 3 million Venezuelan migrants worldwide sent $3.4
billion in remittances in 2018. This estimate is based on survey results suggesting that 75% of Venezuelan migrants are
sending 20-25% of their income back home in the form of remittances.
Table 4: Venezuelan Migrant Populations and RemittancesCountry where migrants reside
Venezuelan migrants

Estimated Remittances Sent, USD

10

Share
incomeof

Costa Rica

39,000$34,222,500

22%

Panama79,990$112,845,893

29%

Brazil

50,000$43,875,000

22%

Chile

288,233$252,924,458

22%

Colombia

870,000$226,482,750

15%

Ecuador

200,000$60,075,000

15%United States

450,000$1,518,750,000

15%

Peru

700,000$614,250,000

22%Rest of countries

300,000$607,500,000-

3,000,000$3,470,925,600

-

World

Venezuelan Households receiving remittances: 2,025,000 (out of 8 million households)
Source: Manuel Orozco, 2018. Data based on surveys conducted in Chile, Colombia, and Panama among Venezuelan
migrants. Interviews with money transfer operators.
Surveys conducted by the Inter-American Dialogue in 2018-2019 with Venezuelan migrants in Chile, Colombia, Panama
and Costa Rica shed more light on sending amounts and frequencies. Moreover, they highlight the limited options that8

For a detailed discussion of Venezuelan migration and regional responses, see Camilleri and Hampson, “NoStrangers at the Gate: Collective Responsibility and a Region’s Response to the Venezuelan Refugee and Migration
Crisis,” Inter-American Dialogue, October 2018. Available at: https://www.thedialogue.org/analysis/no-strangers-atthe-gate/
9
For more discussion of this topic, see Manuel Orozco, “Latin American and Caribbean Migration from Weak andFailing States,” Inter-American Dialogue, November 2018.
10
Based on survey data suggesting that 75% of Venezuelan migrants send 20-25% of their income.
Remittances to Latin America and the Caribbean in 2018

6

Venezuelan migrants have to send money through formal mechanisms such as remittance agencies, banks, or mobile
or online remittance platforms. Many Venezuelan migrants are sending through “other” mechanisms, including thirdparty accounts.
Table 5: Venezuelan Migrants and Remittance Sending Behavior (Money Sent)

Remittances

Ave. Cost

Sending Method (%)

AverageIn
USD

AgencyRemittance(USD)

AverageFrequency

As %TravelerBank

MobileInternet

Other,
Incl. Third
Party
Accounts

Venezuelans$92.3
17.4 $6.61 8.0%
23.2
2.0 1.0
0.0
0.0
73.7
times/ year
in Chile
Venezuelans$33.7
11.7 $2.03 6.1%
70.9
0.6 10.1
1.0
1.1
16.5
times/ yearin Colombia
Venezuelans$110.211.8 $1.94 2.7%
57.3
6.7 30.7
0.0
0.0
5.0
times/ year
in Panama
Venezuelans$117.618.1 $9.71 7.7%
14.7
2.7
4.0
6.7
72.0
times/
year
in Costa Rica
Source: Surveys of Venezuelan Migrants, 2018-2019. Includes 99 Venezuelans in Chile, 436 Venezuelans in Colombia, 75
Venezuelans in Panama, and 75 Venezuelans in Costa Rica. Do note Banks and agencies may include third country transfers
and at least one web-based operator is likely informal.
Given the difficulties in sending money to Venezuela and the very profound issues related to currency devaluation, inkind remittances (goods such as food and clothes that are sent to families in parcels) play an important role. For
example, 40% of Venezuelans in Panama are sending in-kind remittances roughly four times per year. The table below
provides additional detail.
Table 6: Venezuelan Migrants and Remittance Sending Behavior (In-Kind Remittances)Yearly value(USD)

AverageFrequency

Cost of(USD)

Sending% Using

Venezuelans
Chile

in

US$3003 times/ year

$21.97

11.0%

Venezuelans
Colombia

in

US$3909.2 times /year

$3.44

6.9%

Venezuelans
Panamain

US$285

3.5 times /year$57.3240%

Venezuelans in
US$2004 times /year$45.0036%
Costa Rica
Source: Surveys of Venezuelan Migrants, 2018-2019. Includes 99 Venezuelans in Chile, 436 Venezuelans in Colombia, 75
Venezuelans in Panama, and 75 Venezuelans in Costa Rica.

Colombia
Remittances to Colombia have continued to grow, even as relevant changes in their originating countries haveoccurred in the past decade. In 2018, Colombia received $6.3 billion in remittances. This is the second year in the row
of strong remittance growth, at 15%.
In 2007, remittances from the U.S. and Spain were very much at the same level and represented over 80% of the total.
Since 2007, Spain has increasingly lost prominence as a sending country. Overall, total remittances have grownconsistently since 2015.
Remittances to Latin America and the Caribbean in 20187

Table 7: Remittances to Colombia by Point of Origination - As a Percentage of Total Remittances
2007

2018

Change

U.S.
41.4%
46.5%
5.1%
Spain
41.2%
14.9%
-26.3%
Chile
0.5%
6.2%
5.7%
Ecuador
0.9%
4.3%
3.4%
Panama
1.8%
3.9%
2.0%
Peru
0.3%
1.9%
1.6%
Mexico
1.0%
1.8%
0.8%
Brazil
0.1%
1.7%
1.7%
Argentina
0.2%
1.3%
1.2%
All but the above
22.4%
17.5%
-4.9%
Source: Colombian Central Bank, “Encuesta trimestral de remesas- Banco de la República.”
Meanwhile, remittances to Colombia from other Latin American countries have increased substantially over thisperiod, as can be seen in the following graphic.
Graphic 3: Remittances to Colombia from Select Countries, 2007-2018 (US$ Million)
450.0
400.0
350.0
300.0
250.0
200.0
150.0
100.0
50.0
0.0
2007
Chile

2008

2009
Ecuador

2010

2011

2012

Panama

Peru

2013

2014

2015

Mexico2016

2017

Brazil2018

Argentina

Source: Colombian Central Bank, “Encuesta trimestral de remesas- Banco de la República.”
A recent survey by the Inter-American Dialogue of remittance recipients in Colombia provides additional informationon the average size and frequency of the remittances they are receiving.
Table 8: Remittances to Colombia: Sending Frequencies and Principal Amounts

From

Average Frequency

Average Remittance

Average Sent per Year

United States

7.3 times/ year$290

$2,120Spain

8.1 times/year$270$2,195South America
5.4 times/ year
$210
Source: Survey of 500 remittance recipients in Colombia. Inter-American Dialogue, 2018.

$1,134In terms of payout methods, in Colombia roughly one third of remittance recipients receive their remittance directly
to be deposited in a bank account. From 2014 to 2018, there has been growth in direct deposit, from 24.8% to 31.4%. 11

11Colombian Central Bank, “Encuesta trimestral de remesas,” Remesas por Modalidad de Pago, 2014 – 2018.

Remittances to Latin America and the Caribbean in 2018

8

Central American Countries
Remittances to Guatemala, Honduras, El Salvador and Nicaragua showed strong growth in 2018. Among thesecountries, Guatemala stands out as the country with the largest remittance inflows ($9.3 billion), as well as the highest
remittance growth (13.4%). Remittances to Nicaragua reached $1.5 billion in 2018, which represents roughly 8% growthover 2017. Moreover, remittances represent 11% of GDP in Nicaragua amidst sluggish overall economic growth ofnegative 3.8%. Countries such as Costa Rica and Panama, which are countries that both receive and send remittances,
will be discussed in greater detail in the next section, which focuses on intraregional flows.
Table 9: Remittances to Central American Countries in 2018

Countries

2018 Remittances(,000,000 USD)

Costa Rica*

531

El Salvador
GuatemalaRemittance Growth
2016

2017

GDP
GrowthRemittances
/ GDP

-6.0%

2.7%

1%

2018e

0%

3%

5,469

7%

10%

8.5%

2.8%

21%

9,288

14%

14%

13.4%

2.7%

12%

Honduras*

4,751

5%

12%

10.4%

3.6%

20%

Nicaragua

1,501

6%

10%

7.9%

-3.8%

11%

Panama*
457
-10%
4%
2.9%
4.0%
1%
Source: Central Bank Data and INEC data for Panama; * estimates are marked and use most recent Central Bank data as ofMarch 20, 2019; For GDP growth and Remittances GDP: Inter-American Dialogue’s estimates based on World Bank figuresfor GDP and economic growth.
Emigration from Northern Triangle countries has continued, with an estimated 150,000 migrants from El Salvador,
Guatemala and Honduras entering the United States in 2018. The table below presents estimated undocumented
migration to the United States from Northern Triangle countries on an annual basis.
Table 10: Estimated Annual Migration from the Northern Triangle to the United States (Irregular Migration only)Year

El Salvador*

GuatemalaHonduras

Northern Triangle

2009

61,00043,48550,205

154,690

2016

28,11635,75155,012

118,879

2017

9,844

51,88937,15698,8882018
10,71953,13937,508101,366
Source: Authors’ estimates. *In 2009, 23% of migrants entered via authorized legal entry, and 61% in 2017.
However, it is important to note that while this migration continues, it is occurring at a slightly slower rate than in thepast. This decline is particularly noticeable because the pattern of deportations has remained steady. Eventually,
because most Central American migration to the US is irregular, the continued numbers of deportations effectively
reduce the number of people in the country. In turn, the replenishment ratio of migrants from the Northern Triangle
declines because the number of entries is quite modest. In fact, net migration – which is calculated as the difference
between new migrant entries and deportations— was 67,000 in 2017. If we add to this continued border enforcement
and the termination of Temporary Protected Status for more than 300,000 Central Americans from El Salvador and
Honduras, the size of the migrant population will decline even further.
These changes will have a number of impacts for economies in the region. It will be important to find strategies to help
returning migrants integrate into the labor market, which is already saturated and highly informal. Moreover, given

Remittances to Latin America and the Caribbean in 20189

the importance of remittances to economies in the region – ranging from 21% of GDP in El Salvador to 12% in Guatemala– it will be important to consider alternate strategies to support livelihoods and generate wealth.
In the case of Nicaragua, remittances to the country have been growing constantly, year after year. Since 2015, we also
observe increases in the percentage of the GDP they represent. Despite the alleged economic growth sustained byagriculture, reliance on remittances has been relatively constant and increasing, as the following graphic indicates. To
put the importance of remittances in perspective, the country receives at least 500,000 person-to-person transfers
reaching roughly one third of households in Nicaragua.
As with the Northern Triangle, Nicaraguan foreign labor migration is a byproduct of the poor model of growth, one
which precedes the 1980s period when thousands of Nicaraguans left escaping the civil war. 12 Given the economic
asymmetries between Nicaragua and Costa Rica (Costa Rica’s minimum wages are at least five times that ofNicaragua’s) and a growing international demand for foreign labor in strategically important areas, there are roughly
700,000 Nicaraguans living and working abroad, particularly in Costa Rica and the United States. These migrants are
sending 1.5 billion dollars in remittances annually. Nearly half of those flows come from Nicaraguans in the UnitedStates and the other half from Nicaraguans in Costa Rica.
The current political crisis in Nicaragua, which started with protests in April 2018, has led to new waves of migration.
Meanwhile, the country’s economic performance has taken a sharp downward turn, threatening the economic
livelihoods of Nicaraguans.13
Graphic 4: Remittances to Nicaragua, Yearly Growth and % of GDP
12
10
8
6
4
2
0
2014

2015

2016

Personal remittances received (% of GDP)

2017

2018

Interannual remittance growth (%)

Source: World Bank data, 2018; Nicaragua Central Bank; and authors’ estimates.

12

This is excerpted from the Inter-American Dialogue’s Country Profile on Nicaragua. For more detail, see ManuelOrozco, “Country Profile: Nicaragua,” Inter-American Dialogue, March 2019.
13
See, for example, a recent article in Confidencial, which quotes Nestor Avendano, Executive Director ofConsultants for Business Development (COPADES in Spanish), as saying: “nos encontramos al borde del precipicio
económico, financiero y social. Caer en él significaría el desplome del gasto de inversión fija (construcción yadquisición de maquinaria y equipo) y del gasto de consumo de los hogares, depresión económica, creciente
desempleo y subempleo, caída de la recaudación, y reducción inexorable del gasto de consumo público.”https://confidencial.com.ni/el-colapso-economico-ya-comenzo/

Remittances to Latin America and the Caribbean in 201810

New surveys by the Inter-American Dialogue of Nicaraguans in Costa Rica and Panama provide additional detail on
sending methods, as well as on the average size and frequency of the remittances being sent.
Table 11: Remittances to Nicaragua – Surveys with Migrant Senders
Average

Average

RemittanceFrequency

Average Cost

Sending Method

In USDAs %Agencies

TravelersBank

MobileInternet

Other

$5.76

11.1%

88.0%

0.0%

4.0%

2.0%

0.0%

6.0%

(USD)

Cash Remittances
Nicaraguans
in Panama$85.08

Nicaraguans
in Costa Rica

$130.06

10.2
times/
year

15.2$5.69 5.8%
92.7%
0.9%
2.3% 0.9%
0.5%
times/
year
Source: Surveys by the Inter-American Dialogue, 2018-2019. Includes 50 Nicaraguans in Panama and 220 Nicaraguans in
Costa Rica.
Table 12: In-kind Remittances to Nicaragua – Surveys with Migrant Senders

In kind Remittances

Nicaraguans
in Panama

Average
Value
USD

AverageFrequency% UsingPrimary Sending Methods$146

2.8 times/ year

$20.0%

Formal - Company

Nicaraguans $160
6.8 times/ year
20.5%
Formal - Company
in Costa Rica
Source: Surveys by the Inter-American Dialogue, 2018-2019. Includes 50 Nicaraguans in Panama and 220 Nicaraguans in
Costa Rica.
The next section, focusing on Intra-Regional Migration and Remittances, discusses Costa Rica, Chile and Panama in
more depth, completing the picture of these trends from the host countries’ perspective.

Remittances to Latin America and the Caribbean in 201811

III. Intra-Regional Migration and Growth inRemittances
A key factor explaining the increase in remittances is intra-regional migration, mostly related to political instability inthe region. Three countries that are witness to these increases are Panama, Chile, and Costa Rica, which are
increasingly becoming countries of destination for migrants from neighboring countries that are undergoing politicalcrises. In this section, we present a brief analysis of trends in intra-regional migration and remittances, as well as
original survey data regarding South-South remittance behavior.
Political instability has been a key driver of intra-regional migration in 2018. Migration from 8 countries experiencing
political tensions (see table below) represents more than a third of all migration from the Americas. Venezuela is themost striking example; we estimate that there are 3 million Venezuelan migrants abroad and roughly 75% of them are
sending remittances.
The following table presents 2017 data on migration from fragile states for purposes of comparison. It is important tonote that some of the numbers quoted in this report have increased considerably in 2018 alone. For example, thenumber of Haitian migrants in Chile increased from an estimated 73,000 in 2017 to 179,000 in 2018. 14
Table 13: Migration from Fragile or Unstable Countries (2017)
Migrants
fromColombia
Cuba
El Salvador
GuatemalaHaiti
Honduras
Nicaragua
Venezuela
Selected
countries
Latin
America& Caribbean
Share

Brazil

Chile

8,395
2,544
279
357
10,000155
449
50,00079,179146,582
3,173
242
236
73,079249
249
288,233
614,153

286,092

28%

Costa
Rica
26739
5,791
13,984
2,676

Colombia

EcuadorPanama3,947
340,298
39,000432,435

..
1,945
409
490
122
376
611
870,000
873,953

Dom.
Rep
3,687
3,927
273
438
336,729
433
298
5,539
351,324

All
countries
2,736,230
1,558,312
1,559,924
1,117,355
1,364,492
722,430
689,9783,000,000
12,048,721

Share

98,253
2,917
3,330
1,658
559
1,553
13,33579,990201,595

UnitedStates753,847
1,251,037
1,392,663
975,504
671,499597,647
275,909450,000
6,269,250

200,539
3,083
537
442
98
482
403
200,000
405,584

1251,225

458,237

911,290359,347

447,254239,173

23,362,654

39,026,446

71%

45%

94%

96%

98%

91%

84%

27%

31%

Source: Countries’ Migration and/or Statistical Institutes (INEC Costa Rica, UNDESA Honduras, DGMYE Costa Rica, INE
Panama, et. al). July 2018 Venezuelan Migration Report, IOM and official press releases and quotes including
IOMArgentina, La Prensa, LaFmColombia, La Gestion.

PanamaPanama represents another example of intra-regional remittance growth. Until a few years ago, Panama did not havea large migrant population. However, since the reconstruction process of the Panama Canal and the global economic
recession, and more recently the political crises in Colombia, Venezuela, and Nicaragua, migration and remitting haveincreased. Today, Panama is a net sender of remittances. However, outgoing remittances from Panama decreased 5%
in 2018, while incoming flows grew almost 3%.

14

According to the Chilean National Statistics Institute, there were 179,000 Haitians in Chile as of December 31, 2018.

Remittances to Latin America and the Caribbean in 2018

12

47%
83%
94%
89%
87%
85%
93%
74%
76%

Graphic 5: Incoming and Outgoing Remittances – Panama, 2016 – 2018 (USD ,000,000)
900
800
700
600
500
400
300
2016

2017

2018

Received

Sent

Source: Panamanian National Institute of Statistics and Census (INE)
Remittances from Panama to the U.S. and China decreased in 2018, while remittances to the region, including those to
Colombia and Nicaragua, increased.

Graphic 6: Outbound Remittances from Panama, 2016- 2018
350,000

300,000

250,000

200,000

150,000

100,000

50,0000Colombia

Nicaragua

U.S.
2016

China
2017

Dominican Rep.

All Others

2018

Source: Panamanian National Institute of Statistics and Census (INE)

Remittances to Latin America and the Caribbean in 201813

ChileSince 2010, Chile has switched from being a net recipient of remittances to a net sender. According to most recent
data (2016) from Chile’s central bank, the main recipients for outgoing remittances include Perú (31.6%), Colombia(16.1%), and Bolivia (8.4).
Graphic 7: Chile - Incoming and Outgoing Remittances (USD)
800
700
600
500
400
300
200
100
0
2006

2007

2008

2009

2010

2011

Sent - US$000

2012

2013

2014

2015

2016

2017

Received - US$000

Source: Chilean Central Bank
During 2017 and 2018, remittances from Chile have continued to increase, and may have even doubled. 15
Graphic 8: Migrant Populations Residing in Chile (2018)
350,000
300,000
250,000
200,000
150,000
100,000
50,000Peru

Colombia

Venezuela

Bolivia

Argentina

Haiti

Ecuador

Source: Chile’s Statistical Institute: 2018 estimates for migration stocks in the country.

15

Although the Central Bank has not published detailed data for workers’ remittances, the Balance of payments
secondary income account, of which workers’ remittances are about 70%, shows twice the amount it did in 2016.
Remittances to Latin America and the Caribbean in 2018

14

The observed growth in recent years is strongly associated with the migration trends from fragile countries analyzed
previously in this article. Haiti, for example, has grown from virtually 0% of remittances sent out from Chile in 2012 to
5.9% in 2016; Peru has remained more or less constant.
Graphic 9: Remittances from Chile to Select Countries, Year-Over-Year Growth
450%
389%

400%
350%
300%
250%
200%
150%
100%

28%

50%

4%

1%

4%

0%
Perú

Colombia-50%

Bolivia

Haiti

Dominican Rep.

EcuadorArgentina

-11%

-13%
2012

2013

2014

2015

Otros

-15%

2016

Source: Chile’s Central Bank data.

Costa Rica
Costa Rica continues to be a net recipient of remittances, but outgoing remittances tend to grow faster, or during
negative growth years shrink less, than incoming remittances. While the Costa Rica-Nicaragua remittance corridor
remains the biggest intraregional corridor, we can also observe growth in immigration from other countries, including
Colombia, Venezuela, and neighboring Central American countries.
Graphic 10: Incoming and Outgoing Remittances – Costa Rica (USD ,000,000)
160
140
120
100
80
60
40
20
0
IV-2015

I-2016

II-2016 III-2016 IV-2016

I-2017

II-2017 III-2017 IV-2017

Received

I-2018

II-2018 III-2018 IV-2018e

Sent

Source: Costa Rican Central Bank data.

Remittances to Latin America and the Caribbean in 201815

Graphic 11: Incoming and Outgoing Remittances to Costa Rica, Year-Over-Year Growth
25.0%
20.0%
15.0%
10.0%
5.0%
0.0%
2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018e

-5.0%
-10.0%-15.0%-20.0%
Received

Sent

Source: Costa Rican Central Bank data.
Historically, Costa Rica has received labor migration from Nicaragua. However, during 2018 they also received a numberof Nicaraguans fleeing violence. Costa Rica is the number one option due to its geographical proximity as well as its
family ties. For others, such as Colombians and Venezuelans, Costa Rica is one of the various countries they are
migrating to.
According to the newspaper “El Financiero16” Costa Rica received as many refugee status requests in 2018 alone as it
did during the previous 15 years combined.

Trends in South-South Sending Behavior
Sending behavior is shaped by a number of aspects, which include income in the host country, years in the hostcountry, and cost of living in the home country. Sending behavior varies per host country, revealing differences among
various migrant populations, as the table below shows. Table 14 summarizes sending behaviors presented in one table,
so comparison is evident.

16

https://www.elfinancierocr.com/economia-y-politica/costa-rica-se-vuelve-destino-pararefugiados/PMX6WAEEFRBS3B5RN44KFC5CTY/story/
Remittances to Latin America and the Caribbean in 201816

Table 14: Trends in South-South Remittances: Sending Frequency and Averages

Populations

Frequency(Times per year)

Average Sent
(USD)

Sent per Year
(USD)

Migrant Remittance Senders in Chile
All

12.4

165

2,046

Venezuelans

17.4

92

1,601

Haitians

9.6

107

1,027

Migrant Remittance Senders in Panama
All

8.8

213

1,874

Nicaraguans

10.2

85

867

Colombians

7.4

243

1,798

Venezuelans

11.8

110

1,298

Migrant Remittance Senders in Costa Rica
All

15.3

128

1,958

Nicaraguans

15.2

130

1,976

Venezuelans

18.1

117

2,118

Migrant Remittance Senders in Colombia
Venezuelans

11.7

34

398

All

12.2

130

1,586

Source: Survey of 1,400 migrants sending money from Costa Rica, Colombia, Panama and Chile. Inter-American Dialogue,
2018.
It is likely that these differences reflect also differences in the profiles of migrants that migrate from one country
compared to another. For example, Venezuelans in Colombia, a neighboring country, send significantly less than thosein Chile, Panama, or Costa Rica. Nicaraguans in Costa Rica, on the other hand, send more than those in Panama. Thisare very interesting differences which would benefit from more research. The impact of reasons to migrate, income,educational attainment, employment sector, years since arrival, and many others are interesting factors to explore.

IV. Competition and Technology in the RemittanceIndustry
The marketplace for money transfers has also evolved, becoming increasingly competitive and high tech. In particular,
the market has responded to the demand for services in intraregional markets as well as for digital technologies. With
regards to the latter, the use of digital transfers has increased substantially. For example, at least two million out ofseven million monthly transfers to Mexico are currently done through digital-based channels using online or mobile
applications. In addition, many more companies are introducing cross border bill payment as part of the services they
offer.
These developments may be part of a larger trend of migrants using new technologies to stay connected to their homecountry. As the table below indicates, nearly 83% of migrants use WhatsApp to stay connected with family and friendsback home. Moreover, these technologies also appear to be linked to certain remittance behaviors. For example, those
who use the internet to send remittances and access social media send more money than those who do not.

Remittances to Latin America and the Caribbean in 201817

Table 15: Latin American Remittance Senders and Technology Use

Method of Staying in Touch with Home Country

Percent of users

Average Sent per year (US$)
Uses

Does not use

Uses Social Media

23.4%

1,672

1,540

Uses WhatsApp

82.9%

1,708

947

Uses Phone Calls

39.2%

1,665

1,503

Uses MSM

4.1%

582

1,623

Source: Survey of 1,400 migrants sending money from Costa Rica, Colombia, Panama and Chile. Inter-American Dialogue,
2018.
Use of technology for sending remittances has also increased, with relevant differences in sending behavior. In Latin
America, those who send money via web or mobile platforms are among those who send higher principal amounts.
Overall, those who send money via a remittance agency are among those who send more frequently, nearly 14 times
a year in the case of US-outbound remittances.
Table 16: Remittance Behavior vs Sending Mechanisms

Vehicle for sending:Sending from LAC
Average
(USD)

sent

Sending from U.S.
Frequency

Average sent
(USD)

Frequency

Remittance Agency

141

11.7

261

13.8

Bank

120

10.8

337

11.3

Cellphone (including Apps)

232

6.7

425

4.6

Web-based

226

10.6

275

9.5

Travelers

119

8.0

480

5.2

Others

98

18.4

400

3

Source: For LAC-outbound remittances, survey of 1,400 migrants sending money from Costa Rica, Colombia, Panama, andChile. Inter-American Dialogue 2018. For US-outbound remittances, survey of 340 migrants in the U.S., Inter-American
Dialogue, 2017.

Leading Competitors in the Digital Remittance Market
The entry of cross-border digital payment businesses is relatively recent and has seen even more recent increases in
adoption, as discussed in the previous section. Two distinguishable segments are visible now as part of the market
landscape. First are the companies which were already in the remittance market and expanded their product offering
to include digital services while keeping hybrid models, such as Western Union, MoneyGram, and UAE Exchange.
Second are entirely new remittance service providers that entered to offer digital transactions as their sole businessmodel, doing away with the agent model in the origination but, mindful of limitations in developing countries, retaining
strong agent partnerships on the payout side of business. Gradually these companies intend to move entirely into
digital transfers. Examples of this second segment are WorldRemit, Xoom, and Remitly.
As of 2017, global companies offering digital transfers are highly competitive, and handle at least 40% of global flows.
These companies have a major presence in at least 100 countries, with more than 100,000 payment points. While inmost cases the overwhelming majority of their transactions are C2C, and only a fraction are digital, they are setting thetone and sending a message to over a hundred leading companies that mobile and online are the way of the future forthe remittance industry.
The table below presents the characteristics of these companies in relationship to the scope of their network,countries of operation, services offered, transaction cost, and market share.

Remittances to Latin America and the Caribbean in 201818

Table 17: Competitive Features of Digital Businesses, 2017
RSP(* only online/
mobile transfers)

Global Money Transfer Companies
Western Union
UAE Exchange/XpressMoney
MoneyGram
Ria
Transfast
Al Anzari
Azimo
PangeaDigital only
Xoom*
WorldRemit*
Remitly*

Payment
Network

Numberof countries
in which
it operates

Number of Financial
Services ( i.e. online, card,

500,000
200,000
300,000
332,000

200
100+
200+
146

200,000
100,000+
300,000
40,000+78,00030,00040,000+(payment
points)

Cost
(US$)

GlobalMarket
Share

6
6
6
5

8.14
3.44
8.13
6.14

15%
6%
5%
3%

120+
200 ̾
195+
15

3
5
4
4

4.03
3.22
5.06
4.73

1.7%

67
140
10

5
4
5

5.00
5.34
3.24

1.5%
1%
0.5%

remittances, exchange,
payroll deposit, mobile)

Smallworld
200,000
150+
6
6.04
0.6%
Transferwise**account only
59
3
1.97
0.6%
Source: Authors’ estimates based on data collected from news sources, company annual reports, and expert interviews.
Global market share estimate based on 159,000,000 transactions. * offer only online/mobile transfer.
The Latin American and Caribbean market has also experienced important growth in the digital business, especially inthe past four years. The consolidation of Xoom’s footprint in Latin America and the Caribbean takes place just as it
was acquired by Paypal, while Remitly’s entrance into Latin America, prioritizing Mexico and Guatemala, also yielded
relevant impacts on the marketplace. More recently (post 2015) WorldRemit’s efforts to increase its market presence
in LAC have started paying off with increased presence in the Mexican market. Moreover, Western Union’s digital
expansion in Mexico has proven a successful case of transformation, from being one of the largest cash-to-cash
companies into becoming a digital transfer player. As of December 2018, westernunion.com revenue experienced over
20% growth and represented 12% of Western Union’s US$5.6 billion in revenue.17
The three largest remittance receiving markets in the region - Mexico, Guatemala, and Colombia - illustrate theimpressive growth of digital transfers, measured both as increases in the number of corridors where digital products
are offered and their market share. This pattern is in striking contrast to the slow takeoff observed in 2010, when entry
of digital companies was lukewarm, and adoption of digital products was slow.
Table 18: Market Share Participation by Type of Payment Method

Colombia
GuatemalaMexicoPayment method
2015
2018
2015
2018
2015
2018
Cash
72%
54%
77%
66%
82%
67%
Digital*
28%
46%
23%
34%
18%
33%
Total monthly transactions 489,000 598,000 760,000 850,000 6,393,600 6,880,000
Source: Authors’ estimates based on data collected from news sources, company annual reports, and expert interviews.
**We include here transaction amounts from Xoom, Remitly, WorldRemit, and WesternUnion.com

17

Western Union Fourth Quarter Report, 2018.

Remittances to Latin America and the Caribbean in 201819

Remittances to Latin America and the Caribbean in 201820