Fewer than 10% of remittance recipients have bank accounts, largely because traditional banks haven't been interested in small clients. That will change as more remittances are channeled into credit unions and microfinance organizations… In the Dominican Republic, for example, a women's microfinance bank plans to offer medical insurance and education savings plans for remittance-receiving street vendors. Some institutions that have track records of receiving money transfers have been able to securitize those flows, using the funds raised to lend to small businesses.
Geri Smith provides a tight summary on the potential and challenges of remittances to Latin America. The importance of lowering transaction costs is obvious.
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