Haiti’s market for financial services is at an inflection point, with energetic actors seeking to help move the country toward greater financial inclusion. Serious structural barriers have impacted the behavior and decision-making of consumers and suppliers alike, requiring strong leadership, the coordination of key stakeholders, and an enabling environment that encourages experimentation and innovation. The financial services market’s ability to effectively serve all Haitians will be catalyzed by use cases that can promote financial inclusion.
International remittances play a crucial and growing role in the Haitian economy, with an estimated 30-40 percent of Haitian households receiving money from abroad on a regular basis. These flows represent a significant source of income for a substantial proportion of the Haitian population, with estimated annual remittances exceeding USD 2 billion, comprising 21 percent of GDP. This is a larger share of the economy than exports, official development assistance, and foreign direct investment.
The magnitude and regularity of international remittances into Haiti make them uniquely positioned to drive financial inclusion. Remittances have the potential to drive both account ownership and regular usage of accounts, making them a key driver of financial inclusion in Haiti. Despite longstanding efforts by the Haitian government and its partners, financial inclusion in Haiti remains a pressing issue.
The remittance business models in Haiti are characterized by a cash-out standard, where recipients typically receive cash from money transfer operators. However, there is an opportunity to shift the market towards account- or wallet-based access of remittances, making it easier and more attractive for recipients to receive money directly into a bank account or mobile wallet. This could be achieved by making it easier for remittance service providers to allow remittances to flow directly into mobile wallets and by providing financial service advice to remittance recipients.
To harness international remittances to promote financial inclusion, it is essential to create a business and regulatory climate that supports digital payments and financial inclusion broadly. This can be achieved by incorporating the informal economy, creating more streamlined systems and products, laying the groundwork for greater digital liquidity, and reducing the real or perceived risks of creating new partnerships. By taking these steps, Haiti can create a more conducive environment for international remittances to drive financial inclusion.