Explaining Remittances as a Driver of Women's Financial Inclusion in the Mekong Region

UNCDF research has shown that remittances are a high-volume driver for women’s financial inclusion, especially when accessed through digital channels. Although the rapid development of formal remittance markets in the Mekong region has been documented, few studies have examined informal remittance channels or disaggregated data by sex.
As a result, the relationships between international remittances and women’s financial inclusion remain little understood. This study explores both formal and informal international remittance markets in Cambodia, Laos, Myanmar and Viet Nam and identifies innovative solutions to cross-border payments and tailored financial products that advance women’s financial inclusion. The paper generates insights from country-wide MAP-FinScope surveys and customer field interviews, and incorporates feedback from the region’s key remittance service providers through surveys and in-depth interviews.
The study finds that there is a need to formalize, digitize and customize products to better fit the needs of women recipients and form stronger linkages between international remittances and other financial services. Transitioning migrants from using informal to formal remittance products can potentially add an additional US$6–17 billion to the formal remittance market, which in turn can further unlock a more inclusive financial market. Providers identified several innovative solutions, including strengthening digital delivery channels, launching mobile wallet apps and developing remittance-linked savings, as the starting point for product bundling. Such product innovations could be accomplished within the prevailing regulations, although providers felt that clearer regulatory guidelines with regards to partnership models and non-bank institutions could further accelerate product innovation.