International Remittances: Information on Products, Costs, and Consumer Disclosures

Remittances are personal funds immigrants send to their home countries. The United States is the largest remittance-sending country in the world, with more than $36 billion remitted in 2003, according to the International Monetary Fund. The majority of these remittances are sent to Latin America and the Caribbean and they are a very important source of financial flows to many countries. In 2004, the United States, with other countries, pledged to reduce fees for remittances. Remittance senders in the United States can send funds through entities in the formal financial sector such as money transfer operators, banks, and credit unions or other informal means such as couriers. This report provides information on (1) the methods of transmission available to remittance senders in the formal financial sector and the advantages and disadvantages of each, (2) the costs to send remittances through the formal financial sector, and (3) disclosures remittance providers typically provide to senders.