- One in every four dollars sent via remittances in 2017 was received in Europe
- Remittances have provided a $50bn economic boost to the UK since 2008
Xpress Money, one of the world’s most dependable money transfer brands, has found that developed countries in the West have received over $1.5 trillion[i] from remittances since 2007.
New analysis of World Bank data has revealed that over the last 10[ii] years, France ($229bn), Germany ($149bn), Belgium ($106bn), Spain ($99bn), the US ($62bn) and the UK ($50bn) have all received a substantial economic boost, thanks to remittances.
What’s more, with global remittances growing seven per cent to $613bn over the last year, Europe alone received over one in every four dollars sent; totalling around $165bn[iii]. Some of the biggest benefactors in the West to this growing industry in 2017[vi] included:
- France – $25bn
- Germany – $17bn
- Belgium – $10bn
- Spain – $11bn
- UK – $4bn
Sudhesh Giriyan, COO of Xpress Money: “These findings should go a long way to dispelling the myth that remittances are only boosting the economies of developing countries. There are many examples where money needs to be transferred into the West, by people such as business travellers, those coming to shop and going to other parts of the world for job opportunities. Places like the UK and France are also known to attract people all over the world to their famous education institutions, with those studying relying on their family sending money to pay for things like rent.”
Putting food on a loved one’s table
Whilst the West receives a significant portion of remittances, developing countries throughout Africa, Asia and Latin America have the lions share; India, the biggest beneficiary, has received $625bn over the last 10 years[v]. This is significantly larger than Mexico ($250bn) and Nigeria ($202bn), the top receiving countries in Latin America and Africa respectively.
Used for everything from paying rent to putting food on the table, remittances across the rest of the world provide a lifeline to millions of people. In fact, when looking at just 2017[vi], some of the biggest beneficiaries were:
- India – $69bn
- China – $64bn
- Philippines – $33bn
- Mexico – $31bn
- Nigeria – $22bn
- Pakistan – $20bn
Cost to send still too high
Despite this, millions of families are still missing out due to a few big organisations holding monopolies on countries and controlling the costs of remittances. Worryingly, while the global average sits around 7%, African nations, which have some of the highest rates of remittances – South Africa stands at nearly 18% – are almost $1.8bn worse off, according to Overseas Development Institute. This is enough to put four million children into school and provide safe water to 21 million people (ODI).
Giriyan concluded: “Despite a significant volume of remittances going to the West, it’s crucial to remember its importance to developing countries and the impact that high rates can have on a family’s ability to just get by. And, whilst there have been significant steps made to drive down the cost of remittances, the G8’s target of delivering fairer remittances for all hasn’t met the desired success. In fact, we are still 2% away from its goal to reduce costs by 5% – three years after the deadline. What’s more, with the UN calling for the cost of remittances to be as low as 3%, it’s clear that governments, industry leaders and business must come together to solve the problem and achieve this sooner, rather than later.”