Key trends in Q1 2024 remittances: The state of money transfers following earnings season
Money transfers and remittances companies saw growth as well as headwinds in Q1 2024 – we explore trends in the space, as revealed by the earnings results of the biggest publicly traded money transfer providers.
Major money transfer companies continued to report growth in Q1 2024 on the whole. However, below the topline numbers, a number of patterns continue to emerge.
In the latest in our earnings report series, we take a look at the latest quarterly earnings of key companies in the money transfer and remittances space to see where certain companies are pulling ahead, as well as explore some of the main topics these companies were concerned with in Q1 2024.
For this report, we’ve looked at the main money transfer players that are publicly traded, including Western Union, Intermex, Remitly and Euronet. For each of these companies, we’ve extracted data to compare these against each other, as well as examined how often keywords are being mentioned in earnings calls to create a picture of the remittance industry in Q1 2024.
Topics covered:
- Revenue growth in Q1 2024 remittances
- Money transfers ARPU in Q1 2024
- Transaction rates
- Digital driving C2C remittance growth
- Growth and opportunity retain strong focus
- Remitly speaks more about artificial intelligence
Revenue growth in Q1 2024 remittances
Western Union continues to lead by some distance on quarterly consumer remittances revenue. However, when comparing this metric against other players since Q1 2020, it’s clear to see how this gap has been narrowing over time.
According to linear trend projections – calculated based on each company’s current growth rates as well as historic results between Q1 2020 and Q1 2024 – Remitly’s quarterly revenue figure could exceed Western Union’s in Q1 2033, while Wise and Euronet could be set to follow in 2034 and 2035 respectively.
However, because these projections are based on current growth rates, market changes and shifts in company strategy are likely to have an impact on this going forward. For example, if Western Union’s revenue figures were to stay broadly flat in coming quarters, it would take longer than projected for the other players to catch up. The same would be true if Remitly, Wise or Euronet see their growth rates decline moving forward.
In Q1 2024, Remitly and Wise continued to report relatively similar revenue figures ($269m and $273m, respectively), though Remitly has seen a consistently higher growth rate than the UK-based company since Q1 2023.
Euronet and Intermex also continued to see growth in Q1 2024, though the latter has seen lower growth for the year so far on account of slower-than-expected transfer growth in Mexico, one of its core markets.
In terms of growth rate, Remitly and Wise are still leading the pack, having seen growth of 32% and 24% respectively in Q1 2024, though neither grew at the same rate as last year (Remitly’s revenue grew by 50% in Q1 2023, while Wise’s personal business grew by 46%).
Remitly’s relatively fast growth at 32% speaks to the success of its digital model and marketing spend, and was backed by a 35% rise in send volumes to $11.5bn. Despite revenue growth falling since the height of the Covid-19 pandemic, the company is still on track for a $1bn-plus year in 2024.
For Wise, customer acquisition was key to growth, with the number of personal customers growing by 30% to 7.5 million, which in turn drove a 19% rise in volumes to $29bn (around 74% of Wise’s total volumes).
Meanwhile, Western Union is experiencing somewhat of a resurgence, having seen revenues grow by 3% in Q1 2024 YoY versus a 6% decline last year (prompted by a suspension of services in Russia and Belarus). It’s the first time the company has seen positive growth in its first quarter since 2021 and this was largely spurred by growth in its digital business.
Intermex on the other hand has seen lower revenue growth in Q1 2024 at 3.5%, compared to 26.8% in Q1 2023, which it attributed to the aforementioned slowdown, though the company continues to see digital revenues expand, as we discuss in more detail below.
Money transfers ARPU in Q1 2024
Comparing average revenue per user (ARPU) across the three companies for which this is calculable – Remitly, Intermex and Wise’s personal division – we see that Wise’s ARPU has risen by 3% and is now higher than Intermex’s ARPU for the first time.
For Intermex, ARPU has declined by 11% YoY in Q1 2024. The company saw customer numbers rise from 3.6 million in Q1 2023 to 4.2 million in Q1 2024, so this metric once again reflects lower revenue growth during the quarter.
Notably, Intermex and Remitly share a similar focus on migrants and traditional remittances, while Wise’s customer base is centred more on expat money transfers. Intermex is now looking at its recently added markets to try and boost its digital revenues.
In terms of volumes sent per customer (which is only calculable for Wise and Remitly), Remitly saw this rise slightly by 0.4% YoY after seeing consistent YoY quarterly declines during 2023, while Wise saw volumes per customer decline by 12%.
This could partly be attributed to a growing cost of living affecting individual customer transfers. Wise in particular had noted a decline in high volume sends (>£10k), though it had seen growth across low-volume (<£10k) sends, which in turn reduced its volume per customer.
Transaction rates
Transaction rates are reported by the more traditional remittance players – Western Union, Euronet and Intermex. In Q1 2024, Western Union still saw the highest number of transactions by far at 69 million, compared to 40.6 million for Euronet’s Ria and Xe and 13.5 million seen by Intermex.
Euronet saw YoY transaction growth in Q1 2024 at 8%, compared to 12% last year. For Intermex, transaction growth was significantly slower in Q1 2024 at 5% compared to 29% growth.
Meanwhile, Western Union has seen a turnaround, with transaction numbers rising by 6% in Q1 2024, compared to a 6% decline last year, driven by 13% growth in branded digital transactions.
Based on a linear forecast of transactions using current trends, Euronet could take over Western Union in terms of transactions in Q4 2029, while Intermex could double its quarterly transaction number by 2031. Though, similar to our aforementioned revenue projections, this is a forecast assuming current growth rates remain the same.
In terms of revenue per transaction, Western Union’s figure declined YoY by 3% to $13.9, Euronet’s fell by 1% to $9.5 and Intermex’s fell by 1% to $11.1.
Digital driving C2C remittance growth
Wise and Remitly continue to vie for the top spot on digital revenues, with Wise’s rising by 27% to $273.2m while Remitly’s digital revenues rose by 32% to $269.1m. Remitly also noted a growing preference for digital receives, driven partly by activity to move towards digitisation in some countries (as CEO Matt Oppenheimer explained in an interview following the company’s Q1 2024 earnings call).
Euronet reported that direct-to-consumer digital transactions increased by 23%, which it said “reflected a strong demand for digital product” but it did not provide a comparable digital revenue growth figure.
Meanwhile, Western Union’s digital revenues rose by 9% to $221.3m. The company’s digital revenues aren’t as high as its challengers, but it is notable that its branded digital revenues are growing at a faster rate than the rest of the company and gradually taking share away from the cash retail side of the business.
Intermex did not provide its digital revenue figure for Q1 2024, but it did say this quarter that digital revenues had grown by 59%, while digital transactions now account for 34% of the company’s overall transactions (compared to 30% in Q1 2023).
Our calculations show that Intermex’s transactions sent or received digitally saw an 18% increase in Q1 2024, versus general transaction growth of 5%. By contrast, transactions involving no digital on either the send or receive side (i.e. all-cash transactions) saw a -1% reduction YoY.
However, it should be borne in mind that the way Intermex defines digital (i.e. on either the send or receive side) is not the way many other players define it (for example, some only define it on the send side).
Looking specifically at how frequently ‘digital’ is mentioned in earnings calls gives a perspective of how much the concept is playing for these companies. With the exception of Western Union, every company mentioned ‘digital’ significantly more in Q1 2024 compared to Q1 2023.
Intermex is talking about digital transfers a lot more as part of its strategy to expand in Europe through recent acquisitions and investments – a typically cash-led company led by a focus on LatAm, the digital push seems to typify wider industry trends around digitalisation.
Having said this, ‘retail’ is still seeing elevated mention by Western Union and Intermex, showing that this area still holds significance for the space. Unsurprisingly, digital-only Remitly did not mention retail, while Euronet mentioned the phrase with reference to non-remittances related activities.
Growth and opportunity retain strong focus
The term ‘growth’ remains one of the most popular terms across all of the companies in Q1 2024, with Remitly seeing the highest number of mentions in its call and a significantly higher number of uses than Q1 2023.
Euronet also saw a rise in the number of mentions compared to last year, though Western Union and Intermex both used the term less frequently compared to last year.
Having said this, none of the assessed companies used the keyword ‘tailwind’ during the call, while Western Union, Euronet and Intermex all mentioned ‘headwinds’ (once by Western Union and Remitly, twice by Intermex).
The words ‘opportunity’ and ‘opportunities’ continue to be used frequently by companies, with all of the companies tracked seeing a rising number of uses of the term YoY, with the exception of Intermex (when the company had just closed its acquisition of La Nacional).
Notably, Euronet executives spoke more comprehensively about the potential opportunity to grow its share in the wider remittances market. Currently, the company says it holds approximately a 7% share of a market it claims to be worth $800bn overall.
Remitly used the term largely in reference to its growth across the company’s growing number of corridors (now over 5,000), while Western Union noted opportunities in relation to its investments in products, marketing and partnerships.
Mentions of ‘partners’ and ‘partnerships’ were also higher for companies this quarter when compared to Q4 2023, though YoY there were fewer mentions of the term from the Remitly and Euronet calls.
Western Union and Intermex both mentioned partnerships with Visa that are helping expand their capabilities and reach into new markets. Meanwhile, Euronet announced a number of new partnerships, with the most relevant being a collaboration with Bangladesh’s Nagad Wallet.
Remitly speaks more about artificial intelligence
Historically, one topic that has been mentioned less frequently than others across remittances players has been artificial intelligence (AI). The one exception is Remitly, which this quarter once again mentioned the use of generative AI in its risk systems to aid customer support, as well as for creating long-form marketing content.
The rest of the players we tracked didn’t mention AI in their Q1 2024 earnings, though Western Union has referred to exploratory work into generative AI in previous calls.
With the potential of AI continuing to be discussed as a cross-border payment trend, we will continue to see whether incumbent players do discuss it more in the future.
