Everything You Need to Know About Remittance

How Does Remittance Work?

27 October 2025

Discover how remittance works and why it’s vital for families and economies worldwide. Learn about traditional and digital money transfer methods — and see how OTT Remit makes sending money abroad faster, safer, and more affordable.

In today’s connected world, millions of people live and work abroad — supporting their loved ones back home through money transfers known as remittances. Whether it’s to pay for education, healthcare, or daily needs, remittances play a vital role in keeping families, communities, and even entire economies running smoothly.

In this article, we’ll walk you through what remittance really means, why it matters, the different ways people send money across borders, and how modern digital platforms like OTT Remit are changing the game for good.

What is a Remittance?

A remittance is money that someone working abroad send to another person in their home country — usually to support family or friends. These transfers can be done through banks, money transfer operators, mobile apps, or online platforms.

For example, a worker in Canada might send part of their monthly income to their family in the Philippines, India, or Nigeria. That transaction is a remittance.

Why Remittances Matter

Remittances aren’t just personal transfers — they’re a major drive of economic stability and development. According to the World Bank, global remittances reached over $860 billion USD in 2023, with a large portion going to low- and middle-income countries.

Here’s why they matter:

Family support: Remittances help cover essentials like food, rent, healthcare, and education.
Economic growth: In many countries, remittances make up a significant portion of GDP.
Financial Inclusion: Digital remittances help bring unbanked populations into the financial system.
Stability: During crisis or inflation, remittances provide a steady flow of income for families in need.

Common Ways People Send Remittances

There are several ways to send money internationally, each with different steps, costs, and convenience levels. Let’s look at the main options:

1. Bank Transfers

How it works:

The sender goes to their bank (or uses online banking).
They provide the recipient’s full name, bank name, and account details (like IBAN or SWIFT code).
The bank processes the transfer through international payment networks.
The recipient receives the money in their local account — usually within a few business days.

Pros: Secure and reliable.

Cons: High fees, slower processing time, and less favourable exchange rates.

2. Money Transfer Operators (MTOs)

Companies like Western Union or MoneyGram have physical branches and agent networks.

How it works:

Visit a branch or use their website/app.
Provide recipient details and the amount to send.
Pay by cash, card, or bank transfer.
The recipient picks up cash at a local agent location — often within minutes.

Pros: Fast and widely available.

Cons: High service charges and currency conversion fees.

3. Mobile Wallets

With fintech growth, many countries now use mobile wallets (like GCash, M-Pesa, Paytm, etc.).

How it works:

Sender uses a remittance app that supports mobile wallet transfers.
They enter the recipient’s mobile number linked to their wallet.
Funds arrive instantly or within minutes.

Pros: Fast, convenient, and secure.

Cons: Both sender and receiver must have compatible wallets or linked accounts.

4. Online Remittance Platforms (Digital Remittance)

This is the modern, easiest, and often cheapest way to send money — through online apps like OTT Remit.

How it works:

Create an account on the remittance platform.
Verify your identity (for security and compliance).
Add your recipient’s details.
Choose the amount and preferred payout method (bank deposit, cash pickup, or wallet).
Pay online using your debit card, bank account, or e-transfer.
Recipient gets the money — often within minutes.

Pros: Fast, low cost, transparent exchange rates, and 24/7 convenience.

Cons: Requires internet access and digital literacy.

Benefits of Digital Remittance

Digital remittance platforms like OTT Remit have transformed the way people send money abroad. Here’s why more people are switching to online options:

Speed: Transfers complete in minutes instead of days.
Lower fees: Digital platforms have fewer overhead costs, which means better rates for users.
Transparency: Real-time tracking and upfront fee disclosures.
Security: Advanced encryption and compliance with global financial regulations.
Convenience: Send money anytime, anywhere — no need to visit a branch.

Common Challenges in Remittance

Despite its importance, sending money abroad can still be difficult for many people. Common issues include:

High transfer fees from traditional banks or agents.
Hidden exchange rate markups.
Long wait times for funds to arrive.
Limited access to financial services in rural areas.
Security risks with unreliable operators.

Why OTT Remit is the Solution

OTT Remit simplifies international money transfers with:

Lower fees and competitive exchange rates — more money reaches your loved ones.
Multiple payout options (bank deposit, cash pickup, or wallet).
Instant transfers to many countries.
24/7 online support and real-time tracking.
Strong compliance and data security backed by Canadian financial regulations.

With OTT Remit, sending money abroad is faster, safer, and smarter — helping you stay connected to the people who matter most.

Final Thoughts

Remittances are more than just money — they’re acts of love, responsibility, and connection across borders. As digital innovation continues to make global money transfers faster and fairer, platforms like OTT Remit are empowering communities and keeping families closer, no matter where they are in the world.

Disclaimer: The views and opinions expressed by the authors in this publication are their own and do not necessarily reflect the views of OTT Remit, OTT Financial Inc., and the OTT Group of Companies. This publication is provided for general information purposes only and should not be considered as exhaustive or comprehensive in covering all aspects of the discussed topics. It is not intended to replace seeking advice from a specialist or professional.

How To Send Money with OTT Remit

Follow three simple steps to send money quickly and securely to loved ones anywhere in the world.

Sign up for an account

Enter your name and phone number to create an account with OTT Remit.

Enter money transfer details

Choose your destination country and select one of three remittance methods: Cash Pickup, Mobile Wallet, or Bank Deposit. Enter your recipient's information.

Pay for your transfer

Complete your remittance by making an INTERAC e-Transfer. It's that easy!