Money transfer operators such as Western Union and Moneygram stand to lose as much as $400 million in remittance commission due to the launch of El Salvador's Chivo Wallet.
According to CoinMarketCap, remittances account for a $6 billion industry, nearly 23 percent of the country’s GDP. And money service providers like Western Union or MoneyGram are the chosen method of remitting funds to the country.
CNBC’s MacKenzie Sigalos explained that the loss in remittance commission could be close to $400m a year. “If you want to send $10 from Canada to El Salvador via Western Union’s app = $3.24 fee; Muun [to] Chivo wallet = $0.10; Chivo [to] Chivo = free. Present Bukkele’s new bitcoin wallet could cost co’s like Western Union $400m/y,” she said.
According to official data, about 60 percent of remittances are through companies and 38 percent are through banking institutions.