UN Calls for Better Remittance Services at Lower Cost
The United Nations is urging reforms that make it easier for migrants to send money back to their home countries, as it observes its annual International Day of Family Remittances.
“Migrants have shown their continued commitment to their families and communities during the pandemic with more remittances transfers made digitally than ever before,” Gilbert Houngbo, president of the U.N.’s International Fund for Agricultural Development, said in a statement. “Unfortunately, families in rural and remote areas — where remittances are a true lifeline — battle to access cash outlets or even more convenient alternatives such as mobile money accounts. Governments and the private sector need to urgently invest in rural digital infrastructure to address this.”
U.N. Secretary-General Antonio Guterres used his own statement to call for remittance fees to be set “as close to zero as possible,” and for those in the industry to “foster the financial inclusion of migrants and their families.”
“Looking forward, we must continue efforts to support and protect migrants, who — as the COVID-19 pandemic has made clear — play such an important role in keeping essential services and the economy at large running in many parts of the world,” Guterres said.
Data from the World Bank showed remittances to low- and middle-income countries hit $540 billion in 2020, a decline of 1.6% from the previous year. It said last month it expects the amount of money sent to those countries to increase by 2.6% this year and 2.2% in 2022.
Latin America and the Caribbean saw an increase of 6.5% in remittances received last year, according to the World Bank, followed by 5.2% in South Asia and 2.3% percent in the Middle East and North Africa.
Remittances declined 7.9% to East Asia and the Pacific, and 9.7% to Europe and Central Asia. Remittances to sub-Saharan Africa rose 2.3%, not counting Nigeria, which saw the amount of money sent there by migrants plummet 28%.
India, China, Mexico, the Philippines, Egypt and Pakistan were the top destinations for migrants to send money in 2020.
Migrants working in the United States, United Arab Emirates, Saudi Arabia, Switzerland and Germany sent the most money home, according to the World Bank.
Worldwide, the U.N. says there are 200 million migrant workers who send money to support more than 800 million family members, and that in 2020, 75% of that money was spent on “immediate needs.”
The United Nations has set a target for those facilitating remittances to charge no more than a 3% fee. But the World Bank said that at the end of last year, the global average fee to send home $200 was 6.5%.