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What Is Remittance and Why Is It Important?

A remittance is a transfer of money from one person or entity to another, typically across borders. It most often refers to funds sent by individuals working abroad to family members in their home countries. The global remittance market reached $905 billion in 2024, forming a critical financial lifeline for millions of households by supporting basic needs such as food, education, healthcare, and local economic stability.

Remittances have traditionally moved through correspondent banking networks and money transfer operators, but these legacy systems result in slow settlement, trapped capital, and constant friction. Today, modern digital payment infrastructure, including stablecoins, is reshaping how remittances are initiated, settled, and received. Companies like Fireblocks play a key role in this transformation by providing secure, enterprise-grade stablecoin infrastructure. This enables payment providers, banks, and fintechs to settle remittances faster, more efficiently, and at lower cost using blockchain-based rails and stablecoins.

What Is Remittance Used For?

Remittances are primarily used in two ways. 

• Personal remittances occur when migrant workers send money home to support their families, helping pay for everyday essentials such as food, housing, education, and healthcare. These flows act as a stabilizing force for developing economies, often representing a significant share of national income and providing millions of households with reliable financial support. 
• Business remittances involve cross-border B2B payments. For example, settling invoices for goods and services, paying international suppliers, compensating contractors, or funding global operations. Note that most commonly, business remittances are referred to as trade finance. 

Both categories rely on efficient and secure payment rails. By enabling financial institutions, fintechs, and payment companies to move funds globally with speed and transparency, solutions like Fireblocks are helping modernize remittance workflows and expand financial access worldwide.

How Do Remittances Work?

Traditional remittances follow a straightforward but often slow process: 

1. A sender initiates a transfer through a bank, money transfer operator, or digital wallet
2. The provider processes the payment and handles compliance checks
3. Funds are converted and moved via corresponding banking network that the remittance provider has in place 
4. Typically, remittance companies work with a partner network that receives notification that funds are available for collection
5. The recipient then goes to a local agent/retail location with ID to collect  the funds either in cash, through a bank deposit, or in a mobile wallet. 

Common methods include bank wire transfers, services like Western Union or MoneyGram, and app-based platforms that operate on top of traditional banking rails. While reliable, these systems can involve multiple intermediaries and limited operating hours, especially for cross-border payments.

Modern remittance providers are increasingly turning to blockchain and stablecoins to streamline this process. Instead of routing payments through a chain of correspondent banks, a blockchain-based remittance can settle value near-instantly, 24/7, and with fewer intermediaries. 

Many payment companies now use a “stablecoin sandwich” model. This means converting fiat to a stablecoin for fast on-chain transfer, then converting back to fiat for the end recipient. This ensures faster and more efficient value transfer while keeping the user experience familiar and compliant.

What Are the Traditional Challenges with Remittance?

Traditional remittances have long been burdened by high costs and inefficiencies. While remittance companies benefit from high individual transaction margins, the overall fees (accounting for corresponding banks and the partner network) often average 6% per transaction. This is typically borne by the receiver. A significant portion of funds never reach the intended recipient, an especially heavy burden for families relying on these payments for essential needs. Settlement can also take 3–5 business days due to correspondent banking chains, limited operating hours, and manual compliance checks. Senders and recipients also face uncertainty around FX rates, inconsistent transparency, and delays caused by multiple intermediaries. In many developing regions, limited access to bank accounts or reliable financial services makes both sending and receiving remittances even more challenging.

These pain points disproportionately impact the people and businesses who depend on remittances the most, thus reducing the financial support available to vulnerable households and creating friction for global commerce. These challenges also highlight the need for modern infrastructure capable of enabling faster, more efficient, and transparent cross-border transfers, setting the stage for blockchain-based solutions and stablecoin settlement models that dramatically improve global remittances.

What Are the Advantages of Stablecoin Infrastructure for Modern Remittances?

Modern remittance infrastructure powered by stablecoins delivers significant advantages over traditional banking rails. 

• Settlement times shrink from days to minutes, costs fall due to fewer intermediaries, and transfers can occur 24/7 without banking-hour limitations. 
• Blockchain rails also offer greater transparency, since every transaction can be tracked on-chain, and they improve access for underbanked populations who may lack traditional financial services. 
• Programmable payments make it possible to embed compliance checks, automate workflows, and ensure end-to-end security.

By providing secure wallet infrastructure, settlement capabilities, and access to  stablecoin rails across several blockchains, companies like Fireblocks enable organizations to bring these benefits to millions of users worldwide, unlocking new financial possibilities in the onchain economy.

Who Uses Remittance Services?

Remittance services are used by a wide range of individuals and organizations. The largest segment is migrant workers (more than 280 million globally), who send money home to support their families. Remittances are also essential for international businesses that need to pay suppliers, manufacturers, and contractors across borders. Freelancers and gig-economy workers can also rely on cross-border payments from global clients. Behind the scenes, payment service providers (PSPs) and fintech firms manage these transactions on a large scale, delivering remittance services to millions of users.

Modern payment infrastructure now supports a broad ecosystem of participants, from individual consumers to major PSPs. Companies like Ria and Moneygram, both built on Fireblocks, process large remittance volumes across key Latin American corridors, enabling faster and more affordable payouts where they’re needed most. 

What’s the Difference Between Remittances and Regular Payments?

While all remittances are payments, not all payments qualify as remittances. 

Remittances specifically involve cross-border money transfers, often sent by individuals to support family members rather than to pay for goods or services. 

Regular payments can be domestic or international and typically relate to commercial transactions. These can be B2B, P2P, B2C, etc.  

Since remittances cross borders, they face unique challenges such as currency conversion, differing regulatory requirements, higher fees, and more intermediaries. Those are challenges that standard domestic payments generally avoid.

How Is Remittance Infrastructure Evolving?

Remittance infrastructure is rapidly shifting away from legacy correspondent banking models where payments move through long chains of intermediaries. The movement is toward digital-first, blockchain-enabled settlement rails. 

Stablecoins now play a central role in this evolution, allowing value to move instantly across borders without the delays, cut-off times, or operational overhead of traditional banking systems. This builds a more effective base for remittance providers, allowing them to offer quicker services to consumers and businesses alike.

Modern payment orchestration platforms like Fireblocks accelerate this transformation by giving institutions the tools to build compliant, scalable remittance products. Fireblocks connects providers to a global network of liquidity partners, banks, on/off-ramps, and 100+ blockchains, allowing them to launch stablecoin-powered remittance flows with embedded compliance (AML/KYC, Travel Rule) and institutional-grade security. 

How Fireblocks Empowers Companies to Process Remittance

As the world’s most trusted digital asset infrastructure platform, Fireblocks empowers institutions to scale secure cross-border payment operations across 120+ blockchains, while also supporting more than 2,400 organizations and securing over $10 trillion in transactions. Payment providers built on Fireblocks’ digital asset infrastructure process remittance volume across 100+ countries, leveraging blockchain technology and stablecoins to accelerate settlement and reduce transaction costs.

Today, 300+ payment companies using Fireblocks are integrating blockchain infrastructure to remain competitive as regulatory clarity improves. These aspects are driven by frameworks such as MiCA in the EU and emerging digital asset rules in the U.S. This shift marks a new era of programmable, on-chain financial infrastructure designed to support global remittance at scale.

Fireblocks powers this new infrastructure at scale. This enables institutions to move funds across borders faster, more transparently, and at lower cost, modernizing how remittances work for both businesses and individuals worldwide. Most recently, companies like RIA, WorldRemit, MoneyGram have started using Fireblocks to build out their stablecoin remittance offerings. 

At the enterprise level, global leaders like Worldpay use Fireblocks’ infrastructure to accelerate merchant settlements and cross-border flows.  Bridge also serves as a prime example, as their use of the Fireblocks platform allowed them to expand their payment processing and treasury movements. The tools from our platform empower our customers to expand without sacrificing security, performance, and product flexibility. Together, these organizations demonstrate how remittance services have evolved into a universal financial utility.