Paving the Way for Digital Financial Services in Jordan: Market and Regulatory Assessment of Payments and Remittances

Studying the developmental impact of remittances in countries with humanitarian crises

In 2015, Jordan received over USD 3.8 billion in remittances, equivalent to 10% of its GDP, and sent at least USD 500 million. Jordan was selected as the focus of this research because of its large volume of transactions, a population of 9.5 million people that includes more than 2.6 million refugees, and the Central Bank’s strong commitment to financial inclusion. The research presented in this paper explores the Jordanian remittances market and informs development intervention pilots aimed at improving access to financial services for low-income Jordanians and Syrian refugees living in Jordan.

This report covers the ecosystem and regulation of both international remittances and domestic payments systems to which they link. It lays out an analysis of eight inbound and outbound migration and remittances corridors. It covers Jordan’s promising mobile money ecosystem, which is built around the Jordan Mobile Payment (JoMoPay) platform. A few key findings include:

  • Jordan has a regulatory environment that enables the growth of mobile financial services. It has comprehensive regulation on e-money issuance. Issues still being discussed include safeguarding of funds, client protection, and money exchange houses.
  • Jordan’s infrastructure is well-placed to support domestic payments digitization. There is a high level of interconnectivity between mobile services and the broader payments ecosystem, with interoperability between e-money issuers as well as interconnectivity with the broader ecosystem (ATM switch, bill payment platform, cards acquirers).
  • JoMoPay contends with a highly cash-based society. This requires a concerted effort to drive the uptake of mobile payments. However, JoMoPay offers a unique opportunity to connect international payments systems. Given that the Jordanian market is highly competitive, and has numerous client profiles and service providers, achieving scale will require creating a nondiscriminatory and sound playing field.