The world we live in today is highly interconnected and interdependent. In a globalized world, moving from one's own country to a different country is an increasingly common phenomenon known as international migration. Migration can happen for many reasons. Many people migrate, mainly from developing countries to developed countries due to economic reasons, because the labor market in the developed countries tends to have better job opportunities.
Labor migration has shown remarkable improvement in the lives of the migrants and their families. Migrants receive higher income in their host countries and they can send part of their income to families left behind in their home countries. The money sent by the migrant workers to their families back home is referred to as remittances.
Remittances not only increase the recipient's household income but also serve as a stable source of external financing especially in middle and low-income countries, often surpassing foreign direct investments and official development assistance.
Remittance inflows to these countries drive domestic consumption of goods and services, increase foreign exchange reserves, lessen international debt burden, promote economic growth, and poverty reduction.
Migrant workers from the Philippines, also known as Overseas Filipino Workers (OFWs) are regarded as Bagong Bayani (modern-day heroes) for their contributions to the Philippine economy through remittances.
The Philippines is the 4th highest remittance recipient country in the world, only behind India, China, and Mexico, for years in a row as per the World Bank data. Moreover, OFWs tend to send more money to families and loved ones back home during economic hardships or calamities.
OFWs remittances are one of the largest sources of foreign reserves in the Philippines. By December 2020, the country's gross international reserves (GIR) reached a record high of $109.8 billion according to Bangko Sentral NG Pilipinas (BSP).
BSP data showed that the total remittance in 2020 was $33.2 billion, which represented 9.2% of the country's gross domestic product (GDP). However, there is a discrepancy in the total remittance received. $34.9 billion was the total OFW remittances in 2020, constituting 9.6% of the country's GDP, as per the World Bank data.
The country also exports the highest labor to countries like the United States (U.S.), the United Kingdom (U.K.), Canada, Saudi Arabia, Hong Kong, Singapore, and more. Official government data suggest that there are 2.2 million OFWs, both land-based and sea-based workers.
An estimated 700,000 Filipino seamen are deployed in national and international sea vessels. Around 380,000 Filipino seafarers account for one-fourth of all global merchant shipping crews and one-third of the total staff of global cruise ships are Filipinos.
Many OFWs are also in the healthcare sector as frontline workers in the U.S., Europe, Canada, or working in hospitality, domestic help services, logistics, constructions, or oil sector in the middle east. The total number of overseas Filipinos in the world is estimated to be above 12 million. The remittances sent by these huge OFWs population make the country one of the highest remittance-receiving countries.
COVID-19 was a devastating blow to the global economy with mass layoffs worldwide, massive repatriations, lockdowns, and sky-rocketing unemployment rates. The economic crisis induced by the pandemic was predicted to reduce the overall global remittances.
A sharp decline of 20% in remittances in 2020 was projected by the World Bank, mainly due to the fall in wages and job losses of migrant workers who are the first to hit during such a crisis.
However, the global remittances proved resilient despite the projected decline during the pandemic and fell by only 2.4%, from $719 billion in 2019 to $702 billion in 2020.
The repatriation of over 400,000 OFWs workers during the pandemic was concerning and the Philippine central bank projected initially a 5% decline in remittance which was later revised to a 2% contraction. But the actual decline is lower than the contraction of 2%.
The BSP data showed that the total 2020 personal remittances from OFWs amounted to $33.1 billion, only 0.8% lower than the $33.5 billion received in 2019. Cash remittances in 2020 from OFWs also dropped 0.8% to $29.9 billion from $30.1 billion in 2019, defying gloomy expectations by economists.
Cash remittances from Saudi Arabia, Japan, the UK, Germany, the United Arab Emirates (UAE), and Kuwait declined, while those sent from the U.S., Singapore, Canada, Hong Kong, Qatar, South Korea, and Taiwan increased. The U.S. had the highest share of the total remittance at 39.9%, followed by Saudi Arabia, Japan, the UK, the UAE, Canada, Hong Kong, Qatar, and South Korea, which made up a combined remittance of 78.6% of the total receipts.
OFWs remittances for the first four months of 2021 reached $11 billion, 5.1% higher than the $10.49 billion received in the same period in 2020 and a little higher than the $10.8 billion recorded in the first four months of 2019 or pre-pandemic level according to the BSP.
Personal remittances rose to $2.57 billion in April 2021 alone, an increase of 13.1% from the $2.276 billion recorded in April 2020 as lockdowns eased globally, marking the growth for the third consecutive month in 2021.
Cash remittances from OFWs through banks reached $2.3 billion in April 2021, 12.7% higher than the previous year. The year-to-date basis showed a 4.8% increase ($9.89 billion) in cash remittances for January to April 2021.
OFWs remittances reached double-digit growth in May 2021. The central bank data showed 13.1% growth ($2.382 billion) in money transfers through banks from $2.106 billion in May 2020. This increase has been attributed to a 16.2% and 2.7% increase in remittances from land-based workers (from $1.631 billion to $1.84 billion) and sea-based workers (from $475 million to $488 million).
Cash remittances also grew to $12.28 billion, 6.3% higher than $11.554 billion from the previous year. The growth in cash remittances from January to May 2021 largely came from the U.S., Malaysia, South Korea, Singapore, and Canada.
As more economies continue to reopen, travel restrictions are eased, and more jobs are coming back, remittances will recover, further aided by the rollout of COVID-19 vaccinations worldwide.
Even though over 400,000 OFWs have been repatriated since the pandemic started, the demand for OFWs in various sectors abroad remains strong.
The ongoing vaccination rollouts will further enhance the job prospects for overseas Filipinos in the coming months. Filipinos workers will continue to seek jobs overseas as the global economy recovers. The BSP projects a 4% growth in remittances in 2021.
According to recent data released by the central bank, Mexico received an impressive sum of nearly $5.7 billion in remittances during the month of May, setting a new monthly record. However, analysts caution that the strength of the peso against the dollar may have mitigated this achievement.Since the majority of remittances to Mexico originate from the United States, the value is recorded in dollars. Goldman Sachs analyst Alberto Ramos explains that "a strong peso hurts remittances," referring to the fact that the appreciation of the Mexican currency has an adverse effect on the funds received when converted from dollars to pesos.Interestingly, the peso has emerged as one of the top-performing currencies this year, appreciating over 13% against the U.S. dollar between May 2022 and May of this year.Due to the peso's appreciation, when measured in local currency, remittances actually experienced a 2.2% decline compared to the previous year, as stated by Ramos.Mexican President Andres Manuel Lopez Obrador has consistently highlighted the positive impact of remittances on the country's economy. The funds, primarily originating from the United States, have played a significant role in Mexico's economic growth.In 2022, Mexico recorded a record high of $58.5 billion in remittances from abroad, making it the second-largest recipient country, trailing only behind India.Despite the challenges posed by the "super peso," the dollar value of remittances sent in May increased by nearly 11% compared to the previous year.The latest data for May reveals a substantial jump of almost 14% compared to the previous month, resulting in a total inflow of funds reaching $24.67 billion this year.Notably, this amount surpasses the combined revenue generated by oil and agricultural exports during the same period, as noted by analysts at Mexican brokerage Monex.Analysts at Monex and BBVA attribute part of the May surge to the celebration of Mother's Day, suggesting that around 10% of the increased transactions can be attributed to this commemoration.The number of transactions in May experienced a 7% year-on-year increase, reaching a total of 14.56 million. Furthermore, the average amount per transaction rose by 3% to $391.Goldman Sachs' Ramos emphasizes that the strength of remittances reflects the robust U.S. labor market and visible wage growth, particularly in sectors where Mexican citizens are prominently represented.To compare today's best rates when remitting money to Mexico, use CompareRemit's easy-to-use USD to MXN exchange rate comparison tool!
New York, 27/05/2023 – Taptap Send, the innovative mobile money transfer application, is proud to announce its partnership with leading remittance solution provider CompareRemit.com. With a focus on empowering immigrants, Taptap Send simplifies the process of sending money back home to India, Pakistan, Philippines, Bangladesh, Sri Lanka, and Nepal.Sending money across borders has long been a complex and expensive endeavor for immigrants supporting their families and loved ones. Taptap Send was developed to address these challenges, providing a user-friendly mobile application that streamlines and optimizes the money transfer process, all through the convenience of a smartphone.Taptap Send offers a range of features designed to enhance the experience for immigrants sending funds back home:Competitive Rates and No Transfer Fees: Taptap Send leverages technology to streamline operations, resulting in more affordable transfers compared to traditional methods.Mobile Accessibility: The Taptap Send mobile application ensures users can initiate money transfers anytime, anywhere.Transparent Pricing: Users are provided with upfront information on exchange rates, allowing them to make informed decisions and have a clear understanding of the total cost of the transfer.Taptap Send aims to break down the barriers faced by immigrants when sending money back home, enabling them to provide vital support to their families and communities with ease and efficiency.Through its partnership with CompareRemit.com, Taptap Send further expands its reach and impact, offering immigrants a comprehensive range of remittance solutions tailored to their specific needs and requirements.To learn more about Taptap Send and explore the various money transfer options available for sending funds to India, Pakistan, Philippines, Bangladesh, Sri Lanka, and Nepal, please visit the Taptap Send website.About Taptap Send:Taptap Send is a mobile money transfer service that simplifies and enhances the process of sending funds internationally. Designed with immigrants in mind, Taptap Send offers a user-friendly mobile application that empowers users to initiate money transfers conveniently and affordably, providing vital support to their families and loved ones across borders.Media Contact:Name: Anthony JacobTitle: Head of Growth, South AsiaEmail: [email protected]
The leading cross-border money transfer comparison portal expands corridor offering to cater to the growing Canadian immigrant marketSANTA CLARA, CA, November 14, 2018 - CompareRemit, a leading online money transfer comparison marketplace, has announced the launch of a new corridor from Canada to India. The marketplace currently offers money transfer channels from the United States and the United Kingdom.According to the Canadian International Development Platform, in 2016, an estimated $23.3 billion was sent from Canada to other countries such as China ($3.9 billion), India ($2.6 billion) and the Philippines ($2.2 billion). With the immigrant market in Canada continuing to see steady growth, CompareRemit seized this opportunity to grow with it and offer users a simple and seamless method for money transfer, while also broadening the market for its wide array of transfer company partners, according to CompareRemit CEO Rajeev Shrivastava."We are excited to add this new Canadian corridor to our platform," he said. "With the addition of a new corridor, CompareRemit now has its presence in the three largest remittance sending countries the US, the UK, and Canada, which gives our users more options than ever to send money overseas."CompareRemit has helped in seamless money transfers of over $1 billion annually with its partnership with leading money transfer service providers from across the globe. With the addition of a new send corridor from Canada to India, CompareRemit is committed to expanding the network of transfer channels to offer users the most convenient and comprehensive money transfer experience available.About CompareRemit: CompareRemit is a leading money transfer comparison portal with the world's best money transfer companies all at one platform. From becoming the first company to offer remittance rates on smartwatches to offering the widest selection of money transfer companies; CompareRemit has emerged as a leader in the industry. CompareRemit offers a mutually beneficial ecosystem where money transfer companies can reach the niche remittance audience while providing users with an easy-to-use platform where they can satisfy all their remittance needs.