The State of the Remittance Industry and an Outlook for 2025

Money transfers to Latin America and the Caribbean exemplify global economic integration through financial payment rails. In 2024, nearly $170 billion was remitted to the region in small-dollar amounts through a wide network of remittance service providers, or money transfer operators (MTOs) 80 percent of it from the United States.

The flow of money, once considered largely informal and expensive three decades ago, is now managed through a competitive marketplace that offers accessible, affordable, and innovative services.

This briefing provides an overview of the money transfer industry in the U.S.–Latin America and Caribbean (U.S.-LAC) corridor, followed by a review of key challenges anticipated in 2025.

Key takeaways:

• The most active money transfer operators in Latin America and the Caribbean have a global presence.

• Eight money transfer companies account for more than 70 percent of the market.

• There are fewer MTOs than in the early 2000s, but they represent a mix of business models.

• Digital and cash-originated transactions are now almost evenly divided, though they are not entirely separate or mutually exclusive channels.

• Expanding relationships through broader payment networks, diverse origination methods, and especially reliable deposit mechanisms at the destination—as well as the adoption of alternative currency options such as stablecoins or cryptocurrencies—are key factors driving company growth.

• Migration patterns, return flows, and deportations will continue to influence the volume of transfers sent to the region, particularly for certain nationalities.

• Legislative proposals to tax remittances remain in flux and vary from state to state.

• The outlook for 2025 anticipates growth of up to 5 percent; however, depending on the severity of a potential U.S. recession—alongside declining migration and rising deportations—growth may fall short of that estimate.

  
  

A Competitive Remittance Marketplace

Companies in the money transfer business have consolidated into a sector that competes to offer reliable services to remitters. By 2025, a wide range of companies is expected to participate in the intermediation of remittances. These include both longstanding firms with over two decades of operation and newer entrants, offering either cash-originated transactions or digital transfers through various innovative methods. In total, approximately twenty companies may handle 90 percent of the U.S. outbound remittance market.

A Global Presence that Started in Latin America and the Caribbean

The leading competitors offering remittance transfers have become global brands, with a significant presence worldwide. Market share estimates of key companies suggest that ten firms manage approximately 80 percent of flows from the United States–Latin America and Caribbean corridor. These companies including Western Union, PayPal/Xoom, Viamericas, Remitly, MoneyGram, Ria, and Intermex have global footprints, with their earliest operations often beginning in the region.

Western Union, a pioneer in money transfers, began its international expansion in the 1990s in Mexico and Central America through a partnership with exclusive payment agent Piero Coen, who founded Airpak to facilitate payments in the region. Western Union later expanded to nearly every country, establishing a strong presence in Russia and the former Soviet republics. In Latin America and the Caribbean, through the early 2000s, Western Union competed with small, country-specific companies such as Gigante Express, King Express, Delgado Travel, and the U.S. Post Office’s Directo a México platform. Since then, new competitors have entered the market, including MoneyGram, while others struggled to remain active during the first decade of the 2000s. Some were unable to compete and ultimately exited the industry. Although Western Union continues to lead global payments, its market share has diminished due to increasing competition.

Except for Western Union and MoneyGram, which are global leaders, most of the leading money transfer operators in the U.S.–LAC context have been operating for less than thirty years. Smaller companies have remained active by maintaining control over specific country corridors for example, Laparkan in Guyana and Jamaica National Money Services for Jamaica.

The companies listed above have remained strong players in the Western Hemisphere’s money transfer landscape. These businesses have operated for more than twenty years some longer than others in the U.S.-LAC region.

As the table above shows, by the last quarter of 2024, the leading competitor was Remitly a company that began operating in 2013 in the Philippines and gradually expanded to Latin America and the Caribbean five years later. It became a key competitor in the market, holding 14 percent of the market before going public, and reached nearly 23 percent market share by 2024.

Viamericas, founded in 2000, is another example of an emerging twenty-first-century business. Over the span of a decade, it built a solid footprint in the United States and Latin American payment markets, nearly doubling its market share in five years from 5 percent to 10 percent by 2024. Another notable company is Xoom, a pioneer in internet-based transactions founded in 2001. It became a subsidiary of PayPal in 2017 and now operates as a standalone remittance app while also powering PayPal’s in-app remittance service. When Xoom entered the market, it competed directly with Western Union, making significant inroads.

Intermex, which initially maintained a two-country focus (Mexico and Guatemala), has since expanded globally and grown beyond its original markets. The company has also gone public to support its continued growth. Other important players include DolFinTech and FelixPago, both of which hold notable market shares and are advancing in the direction of digital solutions for first- and last-mile payments.

DolFinTech an operation with nearly three decades of experience resulted from a merger of four companies: Barri, DolEx, Quisqueyana, and Europhil. It is now one of the largest privately held money transfer companies, with transactions originating from the United States, Canada, and Spain to Latin America and the Caribbean. DolFinTech serves both retail customers who prefer cash and those who utilize digital channels.

FelixPago, on the other end of the digital spectrum, entered the market in 2022 with a model that few expected to succeed: offering remittances through the WhatsApp platform. Two years later, it is processing transactions in the ten-digit dollar range. Why have some companies succeeded in this segment while others have not? For instance, FelixPago gained traction among WhatsApp users, whereas platforms like Twit Pay (2009) and Facebook’s various remittance initiatives—including its most recent in 2023—struggled to gain similar momentum.

by hedialogue.org