Remittance market loses two providers, but still expands
Two players exited the remittance market last year, cutting the number of primary providers by two to six, but those that remained largely expanded their footprint with the net addition of 28 new locations, according to central bank data.
The number of licensed outlets increased from 425 to 453, indicating more robust remittance activity than 2017 when the net additions amounted to three locations.
The primary providers that left the market were Tropical Money Systems Limited and Jamaica Co-operative Credit Union League Limited. The remaining six are Alliance Financial Services Limited, GraceKennedy Remittance Service Limited, JMMB Money Transfer Limited, JN Money Services Limited, Lasco Financial Services Limited, and VM Money Transfer Services Limited.
Providers often have networks of agents, all of which have to be licensed. The market share held by each provider is unknown, but GraceKennedy is generally considered to be the market leader.
Head of Jamaica Money Remitters Jacinth Hall-Tracey, who confirmed growth in the sector last year despite the reduction of primary providers, explained that one agent may need several licences as they distribute products from different dealers.
Jamaica Money Remitters is the association that represents remittance companies. Hall-Tracey is also managing director of Lasco Financial Services.
Jamaica remains a net receiver of remittances, with inflows mainly from the United States, the United Kingdom, Canada, and The Cayman Islands. Based on the latest data published by the Bank of Jamaica, net remittance inflows for January to November 2018 improved 0.64 per cent year on year to US$2.125 billion across the sector. However, the business done by remittance companies shrank marginally by 0.03 per cent to US$1.81 billion.
For calendar year 2017, remittances for the period grew 0.6 per cent to US$2.305 billion, with remittance companies seeing a spike in incoming money transfers then by 0.8 per cent to US$1.99 billion.