Remittances and Savings Regional Facility

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Latin America and the Caribbean (LAC) is the second region in the world to receive the largest amount of remittances after Asia (including East Asia and the Pacific and South Asia). In 2011, an estimated LAC reached around USD 61,000 billion in international remittances, which were paid in the region by remittance paying companies, commercial banks, microfinance institutions, and credit unions, among others. These payments are processed on a regular basis every month. Of the total remittances received in the region, only a small portion is channeled to savings, and it is estimated that only 20% of recipients have a savings account at a financial institution, prevailing receiving and handling cash in most countries in the region. This is attributed, on the supply side, to the lack of savings products tailored to the needs and preferences of the receiver and the sender as well as to the access and availability of distribution channels. On the demand side there is a lack of financial skills, savings habits and recognition of the benefits generated by the save. The MIF will accompany financial institutions in the region in designing and implementing business strategies that promote the development of savings products tailored to the preferences of people that transfer and adopt alternative distribution channels such as mobile phones and cards, providing savings options close and tailored to the people that send and receive transfers.