Remittances sent by overseas workers act as a safety net in times of disasters, contribute to economic growth and could improve food security in Asia at a time when donor funding is being squeezed.
A new report by the International Fund for Agricultural Development (IFAD) and the World Bank gives a glimpse of how important these inflows are to the world's most populous region.
- Nearly 60 million migrant workers in Asia sent almost US$260 billion to their families in 2012. This represented 63 percent of global flows to developing countries.
- An estimated 70 million Asian households or one in 10 benefit from these flows.
- In Asia, remittances amount to more than five times the sum of official development assistance.
- Seven out of the top 10 remittance-receiving countries are in Asia: India, China, the Philippines, Bangladesh, Pakistan, Vietnam and Indonesia (in order of magnitude).
- Nine countries have remittances exceeding 10 percent of GDP, including Tajikistan, with more than 50 percent.
- Although the majority of the region’s population lives in rural areas, 65 percent of payment locations are in urban areas.
- Most of these rural families live and work outside the world’s financial systems, requiring senders to initiate more than 500 million separate transactions annually and recipients to make another 500 million trips to pick up cash at the other end. The cost for these transactions is estimated at $16 billion each year, or about $30 per transaction.
- Remittances to Kyrgyzstan and Tajikistan, at 32.2 per cent and 51.6 per cent of their respective GDPs, are the highest in Asia.
- Remittance-receiving families remain excluded because banks for the most part are not interested in having them as clients. Individual remittance recipients may enter an Asian bank several times each year to collect their cash, but they are never offered the possibility of a savings account, a small loan or an insurance product.