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As we approach 2025, the money transfer and cross-border payments landscape is evolving rapidly, driven by advances in technology and changing consumer behavior. Money Transfer Operators (MTOs) are embracing innovations to meet growing demands for faster, cheaper, and more secure and transparent cross-border transactions.
From the trends shaping this industry’s future, we would like to highlight the following:
1. Blockchain and Cryptocurrency Integration
Blockchain technology and cryptocurrencies are increasingly influencing cross-border payments. By leveraging decentralized ledgers, MTOs can offer faster and more secure transactions, bypassing traditional banking systems. This trend promises lower fees and real-time settlement, especially when it comes to remittances to developing countries.
To showcase what we have just mentioned, we may consider the following use cases:
MTOs like Ripple, Coins.ph, AZA Finance (formerly BitPesa), Paxful, and Revolut are pioneering the use of blockchain technology and cryptocurrencies to revolutionize cross-border payments. They offer faster, more affordable, and transparent solutions, particularly benefiting users in remittance-heavy markets like Africa, Southeast Asia, and Latin America.
2. AI and Machine Learning for Fraud Detection and Compliance
AI-powered tools are transforming how MTOs handle compliance and fraud prevention. Advanced machine learning algorithms can detect anomalies in real-time, improving security and reducing transaction risks. This trend also enhances anti-money laundering (AML) efforts by identifying suspicious patterns faster than human analysts.
MoneyGram is a notable example of a MTO using AI-powered tools to enhance compliance and fraud prevention. Specifically, MoneyGram uses machine learning algorithms to analyze transaction patterns and identify anomalies that could indicate fraudulent activity, allowing for a proactive intervention. In the same way, they also use AI tools to support Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance by automating the process of verifying customer identities and screening for any suspicious activities. Which significantly reduces manual errors and helps MoneyGram comply with global regulations efficiently.
This transformation aligns with industry trends toward automation in compliance and fraud prevention.
3. Digital-First and Mobile-First Approach
With mobile usage surging globally, particularly in emerging markets, MTOs are increasingly focusing on mobile-first platforms. Digital wallets and mobile apps provide users with seamless, instant transfers, which is crucial for markets with limited access to traditional banking.
According to the latest statistics over 60% of global remittances are already initiated via mobile devices. MTOs like PayPal, TransferWise (now Wise), and Western Union are optimizing their mobile platforms to cater to this growing demand. As such, digital wallets will continue to dominate, with enhanced integration of payment ecosystems for easier transfers across borders, particularly in Africa and Southeast Asia.
4. Real-Time Payments (RTP) and Instant Transfers
Customers are increasingly demanding real-time payments, expecting funds to be available immediately upon transfer.
In fact, if we take into account that;
These statistics demonstrate the significant shift toward real-time payments as a standard for both consumers and businesses, driven by expectations for speed, convenience, and immediacy in financial transactions.
MTOs that integrate RTP solutions can offer near-instantaneous money transfers, a crucial advantage in the competitive remittance market. By 2025, the expectation is that instant transfers will become a norm for cross-border payments, particularly in developed markets, with more countries adopting real-time payment infrastructures that will allow cross-border payments to be as seamless as domestic transfers.
5. Interoperability Between Digital Payment Systems
Interoperability between different digital payment systems and networks is growing. MTOs are collaborating with local fintech companies and banking institutions to create seamless transfers across various platforms, reducing friction in cross-border payments.
In fact, open APIs and partnerships are allowing MTOs to connect with multiple financial ecosystems, offering users a wider range of transfer and payout options, such as bank accounts, mobile wallets, or cash pick-up points. Based on this development we can expect that more countries adopt open banking principles, enabling smoother transfers between international payment systems and national financial services.
Western Union is a leading example of an MTO focusing on interoperability between different digital payment systems and networks. They have integrated with various financial ecosystems globally, allowing customers to send money across platforms seamlessly. For instance, they have partnered with mobile wallet providers like M-Pesa in Kenya, Airtel Money in Africa, and GCash in the Philippines, allowing users to send and receive money through diverse digital systems.
By collaborating with local banks, fintechs, and telecom companies, Western Union ensures that users can access their services from mobile wallets, bank accounts, or cash pickup points. This approach aligns with the broader trend of improving interoperability in cross-border payments, reducing friction, enhancing user convenience and hence fostering smoother international transactions and contributing to greater financial inclusion.
6. Focus on Financial Inclusion
MTOs are playing a critical role in promoting financial inclusion by providing cross-border payment services to unbanked and underbanked populations. Digital solutions like mobile wallets and agent networks are expanding access to financial services for people in rural and underserved regions.
When analyzing remittance-dependent economies in Africa, Asia, and Latin America, we come to the conclusion that they are seeing a rise in financial inclusion due to increased access to mobile banking and money transfer services. This scenario will become even more evident with more MTOs offering innovative financial products, such as microloans and insurance linked to remittances, catering to underserved communities.
7. Cross-Border E-Commerce Integration
As global e-commerce grows, MTOs are increasingly facilitating cross-border payments for online purchases. Seamless payment gateways and low-cost remittance options are helping international buyers and sellers transact more easily across borders.
MTOs like PayPal and Wise are positioning themselves as go-to payment platforms for cross-border ecommerce, benefiting both small businesses and large enterprises.
In fact, according to recent data, PayPal is already one of the most trusted platforms for cross-border payments, with 29% of global online shoppers citing it as their preferred payment method for international purchases. PayPal’s widespread network and ability to handle various currencies make it an essential tool for businesses aiming to expand globally. Additionally, PayPal’s multicurrency features and integration of various payment methods ensure a frictionless shopping experience, which is crucial as 22% of shoppers abandon their carts if their preferred method is unavailable.
Wise (formerly TransferWise), another significant player in cross-border e-commerce, offers businesses a cost-effective solution for international payments with its multi-currency accounts, allowing them to send, receive, and hold payments in over 40 currencies. Wise uses mid-market exchange rates with no hidden charges, and by doing so, businesses avoid the hefty fees typically associated with currency conversions. Wise’s integration with platforms like Shopify, Etsy, and Amazon makes it particularly useful for businesses that want to streamline their global e-commerce operations.
With continued e-commerce growth, MTOs will offer even more integrated services, such as localized payment options and currency conversion tools.
8. Greater Transparency and Lower Fees
Consumers are demanding greater transparency regarding transaction fees, exchange rates, and delivery times. MTOs are responding by reducing hidden fees and offering more clarity on the total cost of a transaction.
Again, if we take into account one of the previous use cases, companies like Wise have set a precedent by providing upfront, transparent pricing models, attracting customers frustrated with traditional banking fees.
By 2025, transparency will be a must-have feature for all MTOs, with many adopting flat-fee pricing structures to attract cost-conscious users.
9. Sustainability and Social Impact
Environmental, Social, and Governance (ESG) considerations are becoming increasingly relevant in the financial sector. MTOs are focusing on sustainability and social responsibility, ensuring that their operations align with broader global goals like reducing poverty and promoting sustainable development.
MTOs are engaging in projects that support financial literacy and sustainable development in remittance receiving countries, aligning their services with the UN’s Sustainable Development Goals (SDGs).
Western Union, for instance, has implemented financial literacy initiatives, especially in remittance dependent regions like Africa, Latin America, and Southeast Asia. They have partnered with NGOs to provide workshops and resources aimed at educating recipients on how to manage remittances, save money, and use financial services effectively. They are also focusing on SDG 1 (No Poverty) and SDG 10 (Reduced Inequalities) by making remittance services more accessible and affordable, which can have a significant impact on poverty reduction and economic growth in developing countries.
World Remit, one of the most renowned mobile wallets, is contributing to financial inclusion by integrating its services with local mobile wallet providers in countries like Kenya, the Philippines, and Nigeria. By facilitating mobile payments, they are providing financial services to previously unbanked populations, supporting SDG 9 (Industry, Innovation, and Infrastructure) and SDG 8 (Decent Work and Economic Growth). They are also encouraging sustainable economic development by helping rural families and individuals access global remittances, enabling them to invest in education, healthcare, and small businesses.
Another interesting use case is Mukuru. This major MTO in Southern Africa helps rural communities use remittances to invest in agriculture, thus contributing to SDG 2 (Zero Hunger) and SDG 8. They also support financial literacy programs that teach recipients how to maximize the impact of the money they receive through better financial management. Mukuru’s network of agents in rural areas ensures that underserved communities can access remittances without needing to travel far to collect funds, supporting SDG 10 by reducing inequality in access to financial services.
Azimo runs financial education campaigns targeting migrant workers and their families in countries like Nigeria, Uganda, and Ghana. These campaigns aim at helping remittance recipients better understand financial products, savings, and investments, contributing to SDG 4 (Quality Education). By partnering with local banks and fintech companies, Azimo tries to improve access to financial services and foster economic growth in underserved areas, supporting SDG 8 and SDG 9.
Finally, we can mention MoneyGram’s partnership with mobile banking solutions across Africa and Asia to help provide unbanked populations with access to digital financial services, aligning with SDG 1 and SDG 10 by reducing barriers to financial services and promoting economic development. Through MoneyGram Foundation, this MTO made investments in educational programs in remittance-receiving countries, supporting SDG 4 by promoting financial literacy, particularly among youth.
By showing these use cases, its easy enough to understand that by 2025, sustainability initiatives will be central to MTOs’ brand image and operational strategy, with more focus on eco-friendly technologies and social impact.
In 2025, we expect Money Transfer Operators to be shaped by blockchain, AI-driven compliance, mobile first solutions, real-time payments, and the push for financial inclusion. As MTOs embrace these technologies and trends, they will play an even more critical role in global remittances, e-commerce, and financial inclusion, making cross-border transactions more efficient and accessible for millions worldwide.
Author
Ana Vargas, Customer Success and Partner Marketing Manager