Syndicate content

Would investing in financial literacy help reduce the use of informal channels?

Ibrahim Sirkeci's picture

Reducing remittance costs are recognized as a vital element of the financing for development strategy and is one of the targets in the Sustainable Development Goals and the Addis Ababa Action Agenda. However, studies show that remittances remain to be a private affair operating mostly at household level.

It is also expected that reduced costs would encourage use of formal channels such as banks and money transfer operators. There are increasingly more money transfer operators in the market offering lower costs among the mainstream MTOs and digital ones. Mobile phone companies and many small operators are also competing on costs. Dilip Ratha clearly puts the argument for reduced costs in his TED talk.

Humanitarians working on cash transfer and remittance researchers need to work together

Kevin Savage's picture
I had the pleasure of attending a workshop organized by KNOMAD at which a cross-disciplinary group of researchers (economics, anthropology, law, health, finance) came together to consider how to strengthen the evidence base of understanding remittances to and from refugees and IDPs.

How do we measure impacts of refugees and IDPs on host countries and host communities?

Kirsten Schuettler's picture

Nearly 60 million persons were forcibly displaced worldwide due to conflict and persecution at the end of 2014—the highest number since World War II. Forced displacement is not only a humanitarian issue, but also has important economic, social, political, and environmental impacts on the places of origin and destination. The development impacts of forced displacement, however, remain poorly understood. There is very limited work to date on the socioeconomic impact of refugees on host and regional economies. Social scientists have largely neglected these important policy and conceptual challenges, in contrast to the countless qualitative studies on refugee livelihoods. As the number of protracted displacement situations is increasing, the lack of rigorous impact assessments is a major gap that needs to be filled. Recently, a number of calls for proposals on the topic have been issued and case studies have been undertaken by the World Bank, UNHCR, independent researchers, and other actors. Efforts have also been made to develop a coherent methodology on how to measure the impacts of forced displacement.

Reaping the blessing of migration in MENA: Mobilizing diaspora resources for private sector development

Sherif Maher Hassan's picture

MENA has always had low private investment both domestic and foreign. However, the political and economic unrests post the ‘Arab Spring’ raised the necessity of a dynamic and growing private sector than ever before. The dominant economic role of the public sector in MENA cannot endure, especially with the escalating unemployment rates, budget deficits, heavy dependence on food and manufactured imports, vulnerability to oil and foreign currency swings besides the challenging social and political environments.

Call for Papers: Forced displacement and gender issues

Dilip Ratha's picture


Forced displacement is a multifaceted phenomenon caused by persecution, conflict, repression, natural and human-made disasters, ecological degradation and other situations that directly endanger lives, freedom and livelihoods. Displacement may be triggered by such diverse actions as development projects, land and assets expropriation and human trafficking, among others. Since women and men traditionally have different socio-cultural-economic roles and positions they are also affected in different manners by forced displacement. Gender play an important role in the decision to flee, throughout the displacement process as well as in the decisions and experience related to finding solutions. The different dimensions of displacement have gender differentiated impacts, requiring a better understanding of how different parts of displaced and host communities are affected at each phase of the displacement cycle.

Remittance reality: Getting to 3% and beyond

Michael Kent's picture

The personal transfers sent home by migrant workers (technically knows as remittances), undoubtedly help fuel the global economy. They alleviate poverty, feed, help educate and support millions of families all over the world. Increasingly they also provide a pathway to financial inclusion for some of the over 2 billion unbanked adults worldwide - for many, receiving a remittance is the first regular, recorded financial transaction that they make.

We know the amounts involved are vast. According to the latest World Bank Factbook 2016, global remittances will exceed $601 billion this year, with developing countries receiving over $440 billion. That’s nearly three times the amount of overseas aid and pretty much all the experts agree those numbers are likely vastly understated.

So far so good, but despite these positive numbers, we’re still at that point where the average cost of transactions globally is hovering at 5 - 10%.

International migration at all-time high, but far short of what is needed

Dilip Ratha's picture

In observance of the International Migrants’ Day, December 18th

“International migration at all-time high,” that’s the headline of our press release (Also available in: Español | Français | русскийالعربية). We decided to release an advance edition of Migration and Remittances Factbook 2016 today, to mark the International Migrants’ Day. Yet, by all means the level of international migration is not too high: at 250 million, it is only 3.4 percent of world population, only slightly higher than 3.0 percent in 1990. Compared to the growth of international trade and investment flows, the increase in international migration is negligible. The world needs more migration, for growth, for reducing poverty, for sharing prosperity. But it can’t, because “we” don’t want too many of “them”. Even if that makes both us and them poorer, our societies less interesting, and not necessarily safer.

The Starting Point for Social Inclusion: Oneness

Colleen Thouez's picture
Our collective understanding of the connection between migration and development has progressed in the last 15 years such that migration is no longer viewed exclusively as a development failure; it is also recognized that migration is tightly linked to development and growth. Indeed, migrants can and do have enormous potential to contribute to the development of their countries of origin and destination.

Such “conceptual awakenings” add clarity to our understanding of the central elements of a global challenge thereby enlightening our path towards collectively meeting it.

Reducing remittance costs and the financing for development strategy

Supriyo De's picture

In observance of International Migrants’ Day, December 18th
For a multimedia presentation with a first-hand account of a person sending remittances see:
Reducing remittance costs are a vital element of the Financing for Development strategy. It has been incorporated as a target in the Sustainable Development Goals (the broad set of global strategies and targets for setting the development agenda up to 2030) and the Addis Ababa Action Agenda (the strategies to finance those development goals). Unlike most domestic resources (such as tax revenues redistributed as grants or public goods) or external resources (for example, foreign direct investment or overseas development assistance), remittances sent by migrants reach households directly. They are however, a private resource, and its deployment is best left at the household level.

Labor migration costs – Too high for low-skilled workers

Soonhwa Yi's picture

In observance of International Migrants’ Day, December 18th
In 2012, a 29-year old Pakistani went to Saudi Arabia to work as a driver. To get the job, he paid some 15 percent of his prospective 3-year income, or $4,800, almost half of what he would be earning in a year in Saudi Arabia. Although he found the job through a relative, most of what he paid went for a visa ($3,800). He worked 11 hours a day and earned $880 a month, far higher than what he earned in Pakistan but lower than what Saudis earn. He sent about 60 percent of his earnings home to support four family members. He was unable to freely express his views, and his travel documents were held by his employer.