The cross-border payments network was vital to the financial survival of families around the world at the height of the covid-19 crisis and continues to play a key role post-pandemic, according to the 2022 Mastercard Borderless Payments Report.
Mastercard surveyed nearly 8,000 consumers across 15 different markets and found that despite evidence of economic recovery – with earnings up globally compared to before the pandemic – and international travel opening up again, all countries are sending and receiving cross-border payments more frequently than 12 months ago, with ‘supporting family’ a key driver for sending money abroad.
Nearly six in 10 people (57 per cent) say they send money abroad to support family and friends, by far the most common reason for making a cross-border payment. With countries around the world bordering on recession or experiencing economic crises, this trend is set to remain.
Both Colombia and Brazil – which particularly suffered during the pandemic with high numbers of cases – report significantly higher levels of cross-border payments received (84 per cent and 75 per cent respectively compared to a global average of 57 per cent but much lower levels of payments sent (30 per cent and 46 per cent compared to an average of 66 per cent), suggesting a reliance on remittances from family or friends abroad.
The market most likely to be sending money home to financially support family and friends is the UAE – a country where migrants form 88 per cent of the resident population and up to 95 per cent of its workforce. According to Mastercard’s research, 84 per cent of people from the UAE say sending money home is the main reason for making cross-border payments – considerably higher than the global average of 54 per cent and up from 72 per cent in 2020.
More than two years on, the economic effects of recent years and of other recent global events mean people are still finding it difficult to make ends meet. Nearly half (45 per cent) of those surveyed globally say that family abroad are still struggling financially and need their financial support, while 40 per cent say their families back home would not have survived recent times if they hadn’t been able to send money home to help support them.
And while more than half (54 per cent) say they have relied on online cross-border payments more than ever before, the data suggests the trend is here to stay, with 71 per cent saying that even though they can now travel home, they will continue to send money online for ease. To enable this, it’s important that cross-border payments are fast, transparent, and secure.
Stephen Grainger, executive vice president, Mastercard Cross Border Services said: “A well-functioning cross-border payment ecosystem has long been a crucial element of the global economy and remittances have become even more vital for families to get by given the huge economic challenges countries around the world are facing.
“Cross-border payments provided a lifeline for many during the pandemic and will continue to do so for the months ahead – playing a key role in keeping the economy moving, and allowing families to put food on the table.”
Mastercard has facilitated increased volume and value of international payments between people and small businesses during the pandemic. Mastercard’s Cross Border Services enable banks, non-banking financial institutions and digital players to support multiple payment use cases and reach 90 per cent of the world’s population in 100+ markets, improving predictability and certainty for international transfers.
A key driver in advancing the company’s multi-rail proposition, Mastercard’s services deliver the choice to globally payout to cards, bank accounts, digital wallets, and cash agents through a single, secure connection
Image and article originally from thefintechtimes.com. Read the original article here.