Remittance

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Remittance advertising in Oxford Street, London with Polish and Russian Remittance advert Oxford Street London 20060909.jpg
Remittance advertising in Oxford Street, London with Polish and Russian

A remittance is a transfer of money by a foreign worker to an individual in their home country. Money sent home by migrants competes with international aid as one of the largest financial inflows to developing countries. Workers' remittances are a significant part of international capital flows, especially with regard to labour-exporting countries. [1]

Wire transfer, bank transfer or credit transfer is a method of electronic funds transfer from one person or entity to another. A wire transfer can be made from one bank account to another bank account or through a transfer of cash at a cash office.

Migrant worker person who migrates within their home country or outside it to pursue work

A "migrant worker" is a person who either migrates within their home country or outside it to pursue work such as seasonal work. Migrant workers usually do not have an intention to stay permanently in the country or region in which they work.

Developing country Nation with a low living standard relative to other countries

A developing country is a country with a less developed industrial base and a low Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreement on which countries fit this category. A nation's GDP per capita compared with other nations can also be a reference point.

Contents

According to the World Bank, in 2018 overall global remittance grew 10% to US$689 billion, including US$528 billion to developing countries. [2] Overall global remittance is expected to grow 3.7% to US$ 715 billion in 2019, including US$549 billion to developing nations. [2]

The World Bank is an international financial institution that provides loans to countries of the world for capital projects. It comprises two institutions: the International Bank for Reconstruction and Development (IBRD), and the International Development Association (IDA). The World Bank is a component of the World Bank Group.

Due to its large diaspora and overseas expats population, India consecutively remains the top receiver of remittance, e.g. with US$80 billion in 2018, [2] US$65.3 billion (2.7% of India's GDP) in 2017, [2] US$ 62.7 billion in 2016 [2] and US$70 billion in 2014, [3] Other top recipients in 2018 were US$67 billion to China, US$34 billion each to Philippines and Mexico, US$26 billion to Egypt. [2]

Non-resident Indian and person of Indian origin ethnic group

Overseas Indians, officially known as Non-resident Indians (NRIs) or Persons of Indian Origin (PIOs), are people of Indian birth, descent, or origin who live outside the Republic of India. Overseas Indians are various individuals or ethnic groups associated with India, usually through ancestry, ethnicity, nationality, citizenship or other affiliation and live abroad overseas. According to a Ministry of External Affairs report, there were 30,995,729 NRIs and PIOs residing outside India as of December 2018. India has one of the largest diaspora populations in the world with over 15.6 million according to the United Nations Department of Economic and Social Affairs.

Economy of India national economy

The economy of India is a developing mixed economy. It is the world's seventh-largest economy by nominal GDP and the third-largest by purchasing power parity (PPP). The country ranks 139th in per capita GDP (nominal) with $2,134 and 122nd in per capita GDP (PPP) with $7,783 as of 2018. After the 1991 economic liberalisation, India achieved 6-7% average GDP growth annually. Since 2014 with the exception of 2017, India's economy has been the world's fastest growing major economy, surpassing China.

Global extent

Remittances are playing an increasingly large role in the economies of many countries. They contribute to economic growth and to the livelihoods of those countries. According to World Bank estimates, remittances will total US$585.1 billion in 2016, of which US$442 billion [4] went to developing countries that involved 250 million migrant workers. [5] For some individual recipient countries, remittances can be as high as a third of their GDP. [5]

International remittances have a major impact on the developing economies of the world with the majority of remittances, $441 billion in 2015, going to developing nations. This amount is nearly triple the $131 billion of global Official Development Assistance. [6] For many developing nations, remittances received make up a significant portion of their economies often receiving over 10% of their GDP in remittances each year. [6] Some countries, such as Tajikistan, receive over half of their national GDP in remittances.[ citation needed ]

Official development aid (ODA) is a term coined by the Development Assistance Committee (DAC) of the Organisation for Economic Co-operation and Development (OECD) to measure aid. The DAC first used the term in 1969. It is widely used as an indicator of international aid flow. It includes some loans.

Gross domestic product market value of goods and services produced within a country

Gross domestic product (GDP) is a monetary measure of the market value of all the final goods and services produced in a period of time, often annually. GDP (nominal) per capita does not, however, reflect differences in the cost of living and the inflation rates of the countries; therefore using a basis of GDP per capita at purchasing power parity (PPP) is arguably more useful when comparing differences in living standards between nations.

Tajikistan Landlocked republic in Central Asia

Tajikistan, officially the Republic of Tajikistan, is a mountainous, landlocked country in Central Asia with an area of 143,100 km2 (55,300 sq mi) and an estimated population of 8.7 million people as of 2016. It is bordered by Afghanistan to the south, Uzbekistan to the west, Kyrgyzstan to the north, and China to the east. The traditional homelands of the Tajik people include present-day Tajikistan as well as parts of Afghanistan and Uzbekistan.

Top recipient countries

Top recipient countries of remittances (in billions of US dollars) [7] [8]
CountryRemittances 2012Remittances 2013Remittances 2014Remittances 2015Remittances 2016Remittances 2017
Flag of India.svg  India 68.8269.9770.9772.2062.769
Flag of the People's Republic of China.svg  China 57.9959.4961.4963.9061.064
Flag of the Philippines.svg  Philippines 24.6126.7027.9029.8029.933
Flag of Mexico.svg  Mexico 23.3723.0224.5025.7028.531
Flag of Nigeria.svg  Nigeria 20.6320.8920.8820.8919.022
Flag of Pakistan.svg  Pakistan 14.0114.6317.8020.1019.820
Flag of Egypt.svg  Egypt 19.2417.8319.8320.4016.620
Flag of Vietnam.svg  Vietnam 10.0011.0011.8012.3013.414
Flag of Bangladesh.svg  Bangladesh 14.2413.8615.1015.8013.713

Note: The countries mentioned below are the largest 15 recipient countries of remittances only for the year 2013. World Bank data is used for all countries and years.

As a share of GDP, the top recipients of remittances in 2013 were Timor-Leste (16.6%), Tajikistan (42.1%), Kyrgyzstan (31.5%), Nepal (28.8%), Moldova (24.9%), Lesotho (24.4%), Samoa (23.8%), Haiti (21.1%), Armenia (21.0%), The Gambia (19.8%), Liberia (18.5%), Lebanon (17.0%), Honduras (16.9%), El Salvador (16.4%), Kosovo (16.1%), Jamaica (15.0%) and Bosnia and Herzegovina (8.82%, which is 1.540 billion $ for 2017 on 31 December 2017 conversion rate between € and US$). [7] [9]

Kyrgyzstan Sovereign state in Central Asia

Kyrgyzstan, officially the Kyrgyz Republic, and also known as Kirghizia, is a country in Central Asia. Kyrgyzstan is a landlocked country with mountainous terrain. It is bordered by Kazakhstan to the north, Uzbekistan to the west and southwest, Tajikistan to the southwest and China to the east. Its capital and largest city is Bishkek.

Nepal country in South Asia

Nepal, officially the Federal Democratic Republic of Nepal, is a landlocked country in South Asia. It is located mainly in the Himalayas, but also includes parts of the Indo-Gangetic Plain. With an estimated population of 26.4 million, it is 48th largest country by population and 93rd largest country by area. It borders China in the north and India in the south, east, and west while Bangladesh is located within only 27 km (17 mi) of its southeastern tip and Bhutan is separated from it by the Indian state of Sikkim. Nepal has a diverse geography, including fertile plains, subalpine forested hills, and eight of the world's ten tallest mountains, including Mount Everest, the highest point on Earth. Kathmandu is the nation's capital and largest city. Nepal is a multiethnic nation with Nepali as the official language.

Moldova Republic in Eastern Europe

Moldova, officially the Republic of Moldova, is a landlocked country in Eastern Europe, bordered by Romania to the west and Ukraine to the north, east, and south. The capital city is Chișinău.

By region

The US has been the leading source of remittances globally in every year since 1983. Russia, Saudi Arabia, and Switzerland have been the next largest senders of remittances since 2007. [7]

Asia

A majority of the remittances have been directed to Asian countries like India (approx. 62.7 billion USD in 2016), China (approx. 61.0 billion USD in 2016), the Philippines (approx. 29.9 billion USD in 2016), Pakistan (19.8 billion USD in 2016) and more. [10]

Most of the remittances happen by the conventional channel of agents, like Western Union, Ria Money Transfer, MoneyGram, UAE Exchange, and similar. However, with the increasing relevance and reach of the Internet, online and mobile phone money transfers have grown significantly. [11]

India

Remittances to India are money transfers from non-resident Indians (NRIs) employed outside the country to family, friends or relatives residing in India. India is the world's leading receiver of remittances, claiming more than 12% of the world's remittances in 2015. Remittances to India stood at US$80 billion in 2018, accounting for over 2.8% of the country's GDP.

Jordan

The flow of remittances to Jordan experienced rapid growth during the 1970s and 1980s when Jordan started exporting skilled labour to the Persian Gulf. These remittances represent an important source of funding for many developing countries, including Jordan. [12] According to the World Bank data on remittances, with about 3 billion USD in 2010 Jordan ranked at 10th place among all developing countries. Jordan ranked among the top 20 recipients of remittances for the preceding decade. In addition, the Arab Monetary Fund (AMF) statistics in 2010 indicate that Jordan was the third biggest recipient of remittances among Arab countries after Egypt and Lebanon. The host countries that have absorbed most of the Jordanian expatriates are Saudi Arabia and the United Arab Emirates, where the available data indicate that about 90% of Jordanian migrants are working in the Persian Gulf. [13]

Philippines

A common shop for remittance in Angeles City, Philippines. M Lhuillier Shop.jpg
A common shop for remittance in Angeles City, Philippines.

According to a World Bank Study, [14] the Philippines is the second largest recipient for remittances in Asia. It was estimated in 1994 that migrants sent over US$2.6 billion back to the Philippines through formal banking systems. With the addition of money sent through private finance companies and return migrants, the 1994 total was closer to US$6 billion annually. [15]

The total is estimated to have grown by 7.8 per cent annually to reach US$21.3 billion in 2010. Remittances are a reliable source of revenue for the Philippines, accounting for 8.9 per cent of the country's GDP. [16]

The Estrada administration in 2000 declared it "The Year of Overseas Filipino Worker in the Recognition of the Determination and Supreme Self-Sacrifice of Overseas Filipino Workers." This declaration connects monetary remittances of overseas workers as the top foreign-exchange earnings in the Philippines. [15]

Latin America and the Caribbean

In Latin America and the Caribbean, remittances play an important role in the economy of the region, totaling over 66.5 billion USD in 2007, with about 75% originating in the United States. This total represents more than the sum of Foreign direct investment and official development aid combined. In seven Latin American and Caribbean countries, remittances even account for more than 10% of GDP and exceed the dollar flows of the largest export product in almost every country in the region. [17]

Percentages ranged from 2% in Mexico, to 18% in El Salvador, 21% in Honduras, and up to 30% in Haiti. [18] The Inter American Development Bank's Multilateral Investment Fund (IDB-MIF) has been the leading agency on regional remittance research. [17]

Mexico received remittance inflows of almost US$24 billion in 2007, 95% of which originated in the US.

North America

United States

A 2004 study found that over 60% of the 16.5 million Latin American-born adults who resided in the United States at the time of the survey regularly sent money home. The remittances sent by these 10 million immigrants were transmitted via more than 100 million individual transactions per year and amounted to an estimated $30 billion during 2004. Each transaction averaged about $150–$250, and, because these migrants tended to send smaller amounts more frequently than others, their remittances had a higher percentage of costs due to transfer fees. [19]

Migrants sent approximately 10% of their household incomes; these remittances made up a corresponding 50–80% of the household incomes for the recipients. Significant amounts of remittances were sent from 37 U.S. states, but six states were identified as the "traditional sending" states: New York (which led the group with 81% of its immigrants making regular remittances), California, Texas, Florida, Illinois, and New Jersey. The high growth rate of remittances to Mexico (not the total amount) is unlikely to continue. In fact, according to the Mexican central bank, remittances grew just 0.6 during the first six months of 2007, as compared to 23% during the same period in 2006. Experts attribute the slowdown to a contraction in the U.S. construction industry, tighter border controls, and a crackdown in the U.S. on illegal immigration. [14]

Remittance culture in the United States has contributed to the formation of "micro-geographies", tightly knit networks that integrate U.S. communities with communities throughout Latin America, such as migrants from Oaxaca, Mexico, who have settled in Venice Beach, California. Oaxacans not only send money back to their communities, but they also travel back and forth extensively. [14]

As of recently, remittances from the United States to Latin America have been on the decline. While there were USD 69.2 billion worth of remittances sent in 2008, that figure has fallen to $58.9 billion for 2011. This trend is a result of many factors including the global recession, more economic opportunity in Latin American countries, and rising fees charged by coyotes to smuggle immigrants across the border. [20]

The pattern of migration has changed from a circular flow, in which immigrants work in the United States for a few years before returning to their families in their home countries, to a one-way stream whereby migrants find themselves stuck in the United States. As a result, the new wave of migrants are both less likely to leave and more likely to stay in the United States for longer periods of time. Overall, this trend has contributed to falling levels of remittances sent to Latin American countries from the United States. [20]

Africa

Remittances to Africa play an important role to national economies. However, little data exists as many rely on informal channels to send money home. Immigrants from Africa today number approximately 20 to 30 million adults, who send around $40 billion USD annually to their families and local communities back home. For the region as a whole, this represents 50 percent more than net official development assistance (ODA) from all sources, and, for most countries, the amount also exceeds foreign direct investment (FDI). In several fragile states, remittances are estimated to exceed 50 percent of GDP. [21]

Most African countries restrict the payment of remittances to banks, which in turn, typically enter into exclusive arrangements with large money transfer companies, like Western Union or Money Gram, to operate on their behalf. This results in limited competition and limited access for consumers, which allows these Money Transfer Operators (MTOs) to charge the highest fees for remittances in the world. [22] However, there are a number of new players aiming to disrupt this established MTO model, such as Xoom and Willstream, which leverage increasing mobile phone penetration in the region and provide different rate structures to Diaspora customers. [23] [24]

According to a World Bank study, [14] Nigeria is by far the top remittance recipient in Africa, accounting for $10 billion in 2010, a slight increase over the previous year ($9.6 billion). Other top recipients include Sudan ($3.2 billion), Kenya ($1.8 billion), Senegal ($1.2 billion), South Africa ($1.0 billion), Uganda ($0.8 billion), Lesotho ($0.5 billion), Ethiopia ($387 million), Mali ($385 million), and Togo ($302 million). As a share of Gross Domestic Product, the top recipients in 2009 were: Lesotho (25%), Togo (10%), Cape Verde (9%), Guinea-Bissau (9%), Senegal (9%), Gambia (8%), Liberia (6%), Sudan (6%), Nigeria (6%), and Kenya (5%). [25]

Nigeria

A major source of foreign-exchange earnings for Nigeria are remittances sent home by Nigerians living abroad. [26] In 2014, 17.5 million Nigerians lived in foreign countries, with the UK and the USA having more than 2 million Nigerians each. [26]

According to the International Organization for Migration, Nigeria witnessed a dramatic increase in remittances sent home from overseas Nigerians, going from USD 2.3 billion in 2004 to 17.9 billion in 2007, representing 6.7% of GDP. In 2016, remittances reached a new record of $35 billion. [27] The United States accounts for the largest portion of official remittances, followed by the United Kingdom, Italy, Canada, Spain and France. On the African continent, Egypt, Equatorial Guinea, Chad, Libya and South Africa are important source countries of remittance flows to Nigeria, while China is the biggest remittance-sending country in Asia.

An August 2016 Nigerian Central Bank (NCB) decision to suspend the operations of all MTOs in the country, except those of Western Union, MoneyGram and Rio, [28] was met with a strong backlash. [29] It was argued that the decision was not appropriately justified, while also standing in contrast to the NCB’s previous move to ban all exclusivity agreements with Western Union. [30] The decision was considered to disproportionally strengthen the dominant position of Western Union, MoneyGram and Rio. [31] Under pressure, however, the Central Bank reversed the decision and granted new licenses to a number of competing MTOs. [32]

Somalia

Somali expatriates often send remittances to their relatives in Greater Somalia through Dahabshiil and other Somali-owned money transfer companies. In order to ensure that these funds go to their intended recipients rather than Al-Shabaab and other militant groups, the governments of the United States, Australia, and a number of other Western countries tightened their banking requirements or stopped processing altogether the remittances. [33] [34] To address the concerns, the United States Congress passed the Money Remittances Improvement Act of 2014. [33]

In April 2015, the Federal Cabinet of Somalia also officially launched the Special Task Force on Remittances (STFR). The multi-agency initiative is mandated with facilitating the Federal Government of Somalia's new national policy pertaining to the money transfer industry. Its main priority is centered on establishing a comprehensive strategy and a consultative implementation plan for the formalization of the local financial sector. Additionally, the STFR is tasked with helping to foster a business environment and financial infrastructure conducive to growth. It is also empowered to coordinate and speed up the endorsement of financial governance instruments and transparency associated legislation, such as the laws on Anti-Money Laundering (AML) and Counter Financing of Terrorism (CFT). In accordance with the Financial Action Task Force (FATF)'s recommendations, the STFR is in turn slated to oversee the Somali federal government's campaign to ratify various international treaties. The Task Forces' membership is scheduled to be announced shortly, and will be drawn from government institutions, the remittance industry, banks and other key private sector stakeholders. [35]

Caucasus

Armenia

Remittances have a big and important impact on the economy of Armenia. In Armenia, they refer to inflows of migrants’ and short-term employee income transfers (personal remittances).

According to the survey, A total of 82% of 2007 migrants reported sending home remittances during 2006 year, and 95% of those send remittances to only one household. On average, they send $270 (first trip) and $345 (last trip), and the average frequency of sending remittances is every 4-6 months. On top of these remittances, the savings brought home each year averaged between USD $1,920 (first trip) and $2,800 (last trip). [36]

In 2018, remittances to Armenia amounted to $1,45 Billion, taking 12% of GDP. [37] The big amount is connected to a large Armenian diaspora spread all around the world: the total population is estimated to be 11 million of which only 3 million Armenians live in Armenia.

In 2017, Russia had the largest remittance flows to Armenia, around 60.5% of overall remittances. The figure amounted to nearly $945 million due to more than 2 million Armenian population living in Russia. Next biggest inflows were recorded from the USA, over $160 million, 10.25% of the overall figure (around 500,000-1,000,000 Armenian population). The list is followed by Kazakhstan remitting $45 million, Germany with $35.106 million and other countries such as UAE, France, Spain averaging to 1.2% of total each. [38] [39]

According to the IMF, starting from 2010 remittances in USD, AMD (Armenian dram), and Rubles, grew until they hit their peak in 2014 and started declining after that in a volatile fashion. Remittances in AMD and USD declined to almost their 2010 levels. [40]

History

Overview

Remittances are not a new phenomenon in the world, being a normal concomitant to migration which has always been a part of human history. Several European countries, for example Spain, Italy and Ireland were heavily dependent on remittances received from their emigrants during the 19th and 20th centuries. In the case of Spain, remittances amounted to the 21% of all of its current account income in 1946. [41] All of those countries created policies on remittances developed after significant research efforts in the field. For instance, Italy was the first country in the world to enact a law to protect remittances in 1901 [42] while Spain was the first country to sign an international treaty (with Argentina in 1960) to lower the cost of the remittances received.[ citation needed ]

Since 2000, remittances have increased sharply worldwide, having almost tripled to $529 billion in 2012. In 2012, migrants from India and China alone sent more than $130 billion to their home countries. [43]

In 2004 the G8 met at the Sea Island Summit and decided to take action to lower the costs for migrant workers who send money back to their friends and families in their country of origin. In light of this, various G8 government developmental organizations, such as the UK government's Department for International Development (DFID) and USAID began to look into ways in which the cost of remitting money could be lowered.

In September 2008, the World Bank established the first international database of remittance prices. The Remittance Prices Worldwide Database [44] provides data on sending and receiving remittances for over 200 "country corridors" worldwide. The "corridors" examined include remittance flows from 32 major sending countries to 89 receiving countries, which account for more than 60% of total remittances to developing countries. [45] The resulting publication of the Remittance Prices Worldwide Database serves four major purposes: benchmarking improvements, allowing comparisons across countries, supporting consumers’ choices, and putting pressure on service providers to improve their services. [45]

At the July 2009 summit in L'Aquila, Italy, G8 heads of government and states endorsed the objective of reducing the cost of remittance services by five percentage points in five years. To drive down costs, the World Bank has begun certifying regional and national databases that use a consistent methodology to compare the cost of sending remittances. [46]

At the G20 2011 Summit in Cannes, Bill Gates stated that, "If the transaction costs on remittances worldwide were cut from where they are today at around 10% to an average of 5%…it would unlock $15bn a year in poor countries." [47] A number of low-cost online services have emerged with the objective of lowering the cost of money transfers to developing and emerging economies.

Dynamics

Emergencies

During disasters or emergencies, remittances can be a vital source of income for people whose other forms of livelihood may have been destroyed by conflict or natural disaster. According to the Overseas Development Institute, this is being increasingly recognized as important by aid actors who are considering better ways of supporting people in emergency responses. [48] An illustrative example can be Armenia, that had experienced a devastating earthquake in Spitak on December 7, 1988, when the Karabakh conflict had already started. About 45,000 people have died, while 500,000 became homeless. Armenia got help from different countries, for example, the U.S. government immediately sent $10 million, which helped to more or less recover the economy. [49] Refugees and other displaced populations also often remit to family members left behind in conflict areas. [50]

Potential security concerns

The recent internationally coordinated effort to stifle possible sources of money laundering and/or terrorist financing has increased the cost of sending remittances, directly increasing costs to the companies facilitating the sending, and indirectly increasing the costs to the person remitting. As in some corridors a sizable amount of remittances is sent through informal channels (family connections, traveling friends, local money lenders, etc.). According to the World Bank, [51] some countries do not report remittances data.

Moreover, when data is available, the methodologies used by countries for remittance data compilation are not publicly available. A 2010 world survey of central banks found significant differences in the quality of remittance data collection across countries: some central banks only used remittances data reported from commercial banks, neglecting to account for remittance flows via money transfer operators and post offices. [52]

Remittances can be difficult to track and potentially sensitive to money laundering (AML) and terror financing (CTF) concerns. Since 9/11 many governments and the Financial Action Task Force (FATF) have taken steps to address informal value transfer systems. This is done through nations' Financial Intelligence Units (FIUs). The principle legislative initiatives in this area are the USA PATRIOT Act, Title III in the United States and, in the EU, through a series of EU Money Laundering Directives. Though no serious terror risk should be associated with migrants sending money to their families, misuse of the financial system remains a serious government concern.

Economic benefits for developing countries

The extent to which remittances produce benefits for developing countries is argued. [53]

World Bank economists contend that remittance receivers' higher propensity to own a bank account means that remittances can promote access to financial services for the sender and recipient, claimed to be an essential aspect of leveraging remittances to promote economic development. [14] For example, in Armenia, which has one of the highest remittance to GDP ratios [7] , studies suggest that those households which receive remittances have a higher propensity to save, however, as opposed to some theoretic frameworks, these savings are not used to leverage borrowing more from the financial system as a way to grow their businesses. [54] Other studies suggest that another channel through which remittances can foster economic growth is the household investment. For instance, the study conducted in South Caucasus reveal that in Armenia having a migrant household member is associated with higher probability of establishing a family business by that household. Thus, the remittances sent by migrants can potentially encourage domestic investment, ensuring economic growth. [55] However, new findings for Armenia suggest that remittances help potential migrants to ease the migration process, serving as a resource rather than as a contractual tool between migrants and non-migrants. It is concluded that remittances drastically shift emigration intentions upward. The need for remittances, and the ability and the strength of the migrant social capital (or the network) are factors which jointly determine emigration intentions. [56] Meanwhile, critical migration scholars have expressed concern about the ability of remittances to address the structural causes of economic underdevelopment [57] [58] and see an increasing policy emphasis on finance as symptomatic of a paradigmatic shift towards a 'self-help development' that burdens the poor. [59]

Remittances are generally thought to be counter-cyclical. The stability of remittance flows amidst financial crises and economic downturns make them a reliable source of foreign exchange earnings for developing countries. [14] As migrant remittances are sent cumulatively over the years and not only by new migrants, remittances are able to be persistent over time. This is particularly true of remittances sent by circular migrants, migrant workers who move back and forth between their home and host countries in a temporary and repetitive manner. At the state level, countries with diversified migration destinations are likely to have more sustainable remittance flows. [14]

From a macroeconomic perspective, there is no conclusive relationship between remittances and GDP growth. [60] While remittances can boost aggregate demand and thereby spur economic activity, other research indicates that remittances may also have adverse macroeconomic impacts by increasing income inequality and reducing labour supply among recipient countries. [61]

The World Bank and the Bank for International Settlements have developed international standards for remittance services. [62]

See also

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The gross national income (GNI), previously known as gross national product (GNP), is the total domestic and foreign output claimed by residents of a country, consisting of gross domestic product (GDP), plus factor incomes earned by foreign residents, minus income earned in the domestic economy by nonresidents. Comparing GNI to GDP shows the degree to which a nation's GDP represents domestic or international activity. GNI has gradually replaced GNP in international statistics. While being conceptually identical, it is calculated differently. GNI is the basis of calculation of the largest part of contributions to the budget of the European Union. In February 2017, Ireland's GDP became so distorted from the base erosion and profit shifting ("BEPS") tax planning tools of U.S. multinationals, that the Central Bank of Ireland replaced Irish GDP with a new metric, Irish Modified GNI*. In 2017, Irish GDP was 162% of Irish Modified GNI*.

Al-Barakat, or Al-Barakaat, which means "Blessings" in Arabic, is a group of companies established in 1986 in Somalia. The firm is involved in the modern form of hawala, an informal value transfer system and remittance method. By 2001, Al-Barakat had outlets in 40 countries, and was the country's largest private employer. It handled about $140 million USD a year from the Somali diaspora, and also offered phone and internet services.

"Gifting remittances" describes a range of scholarly approaches relating remittances to anthropological literature on gift giving. The terms draws on Lisa Cliggett’s “gift remitting,” but is used to describe a wider body of work. Broadly speaking, remittances are the money, goods, services, and knowledge that migrants send back to their home communities or families. Remittances are typically considered as the economic transactions from migrants to those at home. While remittances are also a subject of international development and policy debate and sociological and economic literature, this article focuses on ties with literature on gifting and reciprocity or gift economy founded largely in the work of Marcel Mauss and Marshall Sahlins. While this entry focuses on remittances of money or goods, remittances also take the form of ideas and knowledge. For more on these, see Peggy Levitt's work on "social remittances" which she defines as “the ideas, behaviors, identities, and social capital that flow from receiving to sending country communities.”

Remittances to India are money transfers from non-resident Indians (NRIs) employed outside the country to family, friends or relatives residing in India. India is the world's leading receiver of remittances, claiming more than 12% of the world's remittances in 2015. Remittances to India stood at US$68.968 billion in 2017 and remittances from India to other countries totalled US$5.710 billion, for a net inflow of US$63.258 billion in 2017.

The Kerala Gulf diaspora refers to the people of Kerala living in the Middle Eastern Arab states of the Persian Gulf. In 2008, they numbered more than 2.5 million. Nearly 80 percent of Indians living in Kuwait are from Kerala according to the 2008 survey commissioned by the Department of Non-resident Keralite Affairs.

In anthropology, Cultural remittances are the ensembles of ideas, values, and expressive forms introduced into societies of origin by emigrants and their families as they return home, sometimes for the first time, temporary visits, or permanent resettlement. The term, which has been summarized as "product sent back", developed in the early 2000s, is also used to describe "the way that migrants own and build homes in the country of origin."

The Philippine Labor Migration Policy of the Philippine government allows and encourages emigration. The Department of Foreign Affairs, which is one of the government's arms of emigration, grants Filipinos passports that allow entry to foreign countries. The Philippine government enacted the Migrant Workers and Overseas Filipinos Act of 1995 in order to "institute the policies of overseas employment and establish a higher standard of protection and promotion of the welfare of migrant workers and their families and overseas Filipinos in distress."

Remittances to Nepal are money transfers from Nepalese workers employed outside the country to friends or relatives in Nepal and forms part of the wider global remittance transfers by migrant workers back to their home countries.

Since the late 20th century, substantial labour migration from developing countries to high-income countries has occurred. This includes a substantial portion of female migrants. The term feminization of migration has been proposed as a suggested "gendered pattern" in international migration where there is a trend towards a higher percentage of women among voluntary migrants. Studies on women migrant workers in high-income countries tend to focus on their employment in domestic work and care work for dual-income families.

Money Remittances Improvement Act of 2014

The Money Remittances Improvement Act of 2014 is a bill that passed in the United States House of Representatives during the 113th United States Congress. The bill would "allow the Treasury secretary to use state examinations for certain financial institutions instead of federal reporting requirements." The bill would make it easier for nonbank financial institutions such as money service businesses to provide remittance payments internationally.

Zimbabwean Canadians are Canadian citizens of Zimbabwean descent or a Zimbabwe-born person who resides in Canada. According to the Canada 2011 Census there were 6,425 Canadian citizens who claimed Zimbabwean ancestry and 5,065 Zimbabwean citizens residing in the country at the moment of the census.

WorldRemit

WorldRemit is an online money transfer service that provides international remittance services to migrant communities around the world. Founded in 2010 by Ismail Ahmed, Catherine Wines and Richard Igoe, the company is backed by venture capital companies Accel Partners and Technology Crossover Ventures (TCV). As of 2018, the company had around 3 million users.

International money transfers made by migrant workers and immigrants sending a portion of their earnings to their families in their country of origin are known as remittances. Remittances are an important aspect of the global economy, totaling an estimated $601 billion (USD) for the year 2015. The United States is currently the largest source of international remittances in the world, sending a total of $56.3 billion in 2015. Mexico received the largest portion of these remittances, accounting for an estimated $25.2 billion, making the U.S.-Mexico remittance corridor one of the largest in the world. With the exception of the 2008 global financial crisis, remittances sent from the U.S. have been consistently climbing for the past half century. This major increase in remittances can be partially attributed to the larger population of immigrants and migrant workers, as well as to increasing globalization in the financial and money markets. China and India are also major recipients of U.S. remittances, and are the top two recipients of remittances globally.

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