From the telegraph to the app: The evolution and current status of remittance providers from the United States to Mexico, ca. 1980-2020

This paper offers the first approach to the evolution of the structure and the participants in the remittances market of the United States-Mexico corridor. We identify three different layers in the structure and specify the agents that involve clients, remittance providers, and correspondent banks from 1980 to 2020. We show the structural limitations of the market and suggest how the digital economy and financial technology (fintech) could help to reduce the average cost of cross-border payments. The potential benefits from fintech to the remittances market are especially relevant for Mexico since it has a high proportion of unbanked population. Furthermore, the reduction to 3% of the remittance fees has been defined as one of the United Nations' 2030 Sustainable Development Goals. A better and deeper understanding of the characteristics of this market could help to achieve this goal.