Nicaraguans in US Identify Financial Service Needs

Survey reveals trust is main selling point

February 23, 2007

Nicaraguans living in the United States participate in a focus group discussion on remittance and financial services.

Madison, WI—Nicaraguans living in the United States tend to select remittance providers based on word of mouth, according to a survey conducted by World Council of Credit Unions and Central de Cooperativas de Ahorro y Crédito Financieras de Nicaragua, R.L. (Nicaragua's Central Service Organization, CSO), in Miami, Florida, last fall. The survey explored ways to better market International Remittance Network (IRnet®) services to US-based Nicaraguans and investigated the demand for new financial products such as mortgage loans and savings accounts that could be offered to remittance users.

Last year, remitters in the US sent nearly 60,000 transfers amounting to $15.5 million to Nicaragua through IRnet. The remittances can be sent from a (i) credit union to a credit union; (ii) credit union to a non-credit union; and (iii) non-credit union to a credit union. The largest number of remittances to Nicaragua comes from Miami, where nearly 23,000 Nicaraguans reside. Florida is home to 44% of Nicaraguans living in the United States.

Over five days, 400 Nicaraguan passersby in the Miami neighborhoods of Little Havana and Sweetwater responded to the World Council/CSO survey. Focus groups also provided greater understanding of senders' financial service preferences. Respondents were current remitters, approximately 86% of whom sent between $100 and $500 to Nicaragua at least once a month.

The majority of respondents remain loyal to a money transfer service based on recommendations from a friend or family member living in the United States. Their decision on a remittance service depends on speed of delivery, trust, cost, agent's proximity and other products offered with the service.

Most people knew very little about the characteristics of credit unions, and only one of the 400 survey participants was aware that credit unions in Nicaragua delivered money transfers from the US.

Though 86% of respondents said they intended to return to Nicaragua, more than three of every four participants did not hold a savings account there. The majority of survey respondents expressed interest in opening a savings account in Nicaragua. Half of the Nicaraguans interviewed had savings accounts in a US-based financial institution.

The surveys also revealed that, given the option, Nicaraguans in the Miami area would consider taking out mortgage loans in Nicaragua. Only two of every five people interviewed owned a home in Nicaragua.

Nicaraguan credit unions aim to address the needs remitters expressed for new remittance- linked financial products. There are challenges to overcome, however, given that most respondents were skeptical of products and services advertised through email or telephone and said they would be more confident in a service that had a physical office in the Miami area.

The CSO will present the survey information to its member credit unions in Nicaragua to better inform them of the senders' market and services they could promote. World Council will also share the results with money transfer organizations to expand outreach efforts and increase the awareness of IRnet.

"It's exciting to see credit unions go the extra mile to add value to the remittance service," said Chris McHugh, World Council CDP consultant for Nicaragua. "This research initiative responds to the needs of both remitters and beneficiaries, and it will help leverage the remittance funds into productive, sustainable activities. The multiplying effect can achieve real economic development at the grass-roots level."

A full report of the survey will be available in the research section of World Council's website in April. For more information on IRnet, visit net/index .php.

The United States Agency for International Development (USAID), through the Cooperative Development Program (CDP), funded the research. It has supported World Council's development of low-cost remittance services through credit unions in Nicaragua since 2003.

World Council of Credit Unions is the global trade association and development agency for credit unions. World Council promotes the sustainable development of credit unions and other financial cooperatives around the world to empower people through access to high quality and affordable financial services. World Council advocates on behalf of the global credit union system before international organizations and works with national governments to improve legislation and regulation. Its technical assistance programs introduce new tools and technologies to strengthen credit unions' financial performance and increase their outreach.

World Council has implemented 300+ technical assistance programs in 89 countries. Worldwide, 68,882 credit unions in 109 countries serve 235 million people. Learn more about World Council's impact around the world at

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