The Cycle of Money Movement Drives a Cycle of Opportunity

By Uttam Nayak

In today’s connected world, people can send funds across borders to friends and family in an instant. But it used to be much more complicated, time-consuming, and full of uncertainty. As the SVP of Visa Direct's Central Europe Middle East & Africa (CEMEA) region, I always put myself in other people’s shoes to understand their changing needs and how we can bring value to ensure they are met.

My grandfather was a taxi driver in India. He sent his earnings to my grandmother in our coastal village near Goa State through other bus or taxi drivers heading to our town. Since he never trusted that the money would get there safely, he split currency notes into two pieces and sent only one half of the note at a time. Decades later, when my parents moved our family to the city for better opportunities and education, they were able to send money to our extended family through more effective, formal channels, such as post office money orders and bank transfers. But it still took up to a week or longer to complete these costly transactions.

Today, sending money across borders is easier, faster, and more secure than ever before. Whether traveling for work or relocating to improve quality of life, we can support people back home by sending money from our mobile phones to their bank accounts or eligible cards in-real time [1]. Visa Direct, Visa’s real-time [1] money movement solution, can help make cross-border payments with a single point of access to billions of use cases worldwide. Instant notifications alert users when their transactions are complete.

Adding value to the economy and our lives

With the influx of mobility, the mobile economy, and the power of technology, enabling cross-border receive brings opportunity to financial institutions and the people they serve. Beyond the ease of making billions of transactions through Visa Direct’s global payment network, the impact of money movement across borders adds immeasurable value to people’s lives every day.

Global e-commerce sales are expected to grow to $6 trillion by 2024. [2] Technology has advanced not only the way people send and receive money, but also allows everyone the ability—and access—to buy, sell, and ship products across borders. Local businesses selling a skill, service, idea, or product in any vertical can reach customers worldwide. In Nigeria, for example, there are 200 million people living in rural and semi-urban areas without access to many physical stores. But thanks to mobile phones and the internet, they can receive money from family members to shop online for clothes, accessories, and goods. This drives e-commerce and creates inclusivity among cultures. Technology is also spurring a new generation of content creators along with new ways to make money. From TikTok to Instagram to YouTube, creators can instantly be paid by media agencies right to their Visa Card or bank account—connecting with billions of people while earning an income.

Making an impact in times of crisis

When there's an urgent, humanitarian crisis, cross-border payments make it possible to send money securely to friends, family, and local organizations on the ground in need. In?a short period,?efforts were made to?expand PayPal’s?send and receive peer-to-peer (P2P) payments between friends and family for Ukrainian customers in close partnership with?Visa. PayPal expanded their P2P payments services to ensure that?in addition to sending money,?Ukrainian customers could send and receive funds?from their Ukrainian PayPal Wallet?to their eligible Visa debit and credit cards in real-time [1]. This relief effort provided?a fast and?reliable way to get money into the hands of those who needed it most for living or medical expenses. People coming together to transfer money across the Visa rails facilitated financial assistance from abroad to war-torn?families.?As of April 2022, the overall?purchase?volume and transaction count of?incoming cross-border money transfers?for?Ukraine?has almost doubled as a result of this partnership.

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Enabling cross-border receive is critical for financial institutions

Global remittance volume is set to reach $930 billion by 2026. [3] The Gulf Cooperation Council (GCC) region is the second largest originating region to send money to the rest of the CEMEA region and the world.[4] In the key market of CEMEA, cross-border volume is $126 billion per year and growing [5]—presenting a significant opportunity for financial institutions to generate new revenue streams. A diverse region spanning 93 countries and territories, Pakistan, Egypt and Nigeria hold over half of the receive volume[6]. Whether sending money to a parent, paying for an Uber, or consuming creative content halfway around the world—this constant flow of money helps economies, while giving financial institutions the potential for more profitability and efficiency.

I know firsthand, from my family history and the work I do every day, that financial institutions have an incredible opportunity to use technology to optimize their existing money movement ecosystems and enable cross-border receive. Not only can they keep up with customer expectations for faster, more seamless, transparent, and secure cross-border payments, they also play a role in positively impacting businesses, communities, and individuals by including them in the global economy. Money movement isn’t just about doing business, it’s about changing people’s lives.

For more information on Visa Direct, click HERE

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[1] Actual fund availability depends on receiving financial institution and region.

[2] Shopify’s “The future of ecommerce and trends 2022”

[3] Global Newswire “Remittance Market Size to Grow $930.44 Billion, Globally, by 2026

[4] Market opportunity based on Accenture XB study, April 2021

[5] Market opportunity based on Accenture XB study, April 2021

[6] Market opportunity based on Accenture XB study, April 2021