November 1, 2006
The backroads of El Salvador Central America's smallest and most densely populated country are plastered with billboards advertising Western Union, MoneyGram and a dizzying variety of lesser-known local wire transfer services. No wonder. This year, El Salvador will receive $3 billion in family remittances from the United States, the equivalent to 16% of its GDP. That makes El Salvador more dependent on these "remesas" than any other country in Latin America.
An estimated 2.9 million Salvadorans live abroad, a consequence of the country's 12-year civil war that killed 75,000 people and forced a quarter of the population to flee. These hard-working expatriates, 95% of whom live
Banks are missing out on managing the increasingly large flow of cash being sent home to Central America by expatriates. As remittances swell, so do opportunities.