Imane Charioui, Director of Francophone Africa & Middle East
Beirut, Lebanon – 2022: Family remittances help sustain an estimated one billion people around the world.1 They are understood to be funds transferred from migrants, who mostly work in high-income countries, to their families or communities in low to middle-income countries.
1 out of every 7 people are directly impacted by these inflows and are able to use funds to supplement their personal income.2 There is evidence that remittances alleviate poverty and that 75% of remittances received go towards meeting immediate needs like access to food, health care, education and business capital. As such, this inflow is a source of sustenance.3
The value of global remittances annually surpasses both official development assistance and Foreign Direct Investment (FDI), making remittances a key source of development finance and extremely valuable in low and middle-income countries as they serve in a counter-cyclical capacity during periods of economic downturn.4
During the initial months of the COVID-19 pandemic, there were concerns that the global value of remittances might decline. However, a May 2021 report by the World Bank revealed that remittances stayed nearly flat; registering a total figure of $540 billion in 2020.5 This illustrates the resilience of remittances and the migrants who send them. In this regard, Lebanon ranked as the third largest recipient of remittances among 19 Arab countries according to the World Bank as well, and the inflows of expatriates’ remittances to Lebanon projected at $6.61bn in 2021.6
Over 200 million migrants in the world make continuous contributions to the well-being of their families and help to improve developmental outcomes. The growth of remittances is dependent on global economic forces, which could spur or hinder the growth of inflows. In Lebanon, the rate of poverty has increased due to the crisis, and it has affected approximately 74% of the total population. Moreover, access to healthcare, education and public utilities, increases that rate to 82%.7
“Digital channels serve as one of the most effective solutions to many financial access challenges – this is why WorldRemit is designed as a fully digital platform through which users can transfer funds conveniently, quickly and safely. There continues to be an improvement in the number of people embracing digital financial solutions,” said Imane Charioui, Director of Francophone Africa & Middle East at WorldRemit.
The number of migrants, which has increased as a result of the economic crisis, may have contributed to this increase in remittances. A census by Information International indicated that the number of Lebanese migrants and travelers from the beginning of 2021 until mid-November 2021 reached 77,777, compared to 17,721 in 2020. It also appeared that the number of Lebanese people who emigrated and traveled from Lebanon during the years 2018-2021 reached 195,433, which inevitably led to an increase in the volume of cash flows into the country.8
By incentivizing migrants in the diaspora to make money transfers using digital channels, countries can record higher inflows of remittances and a deeper level of financial inclusion can be achieved, as recipients of remittances will also be incentivised to set up formal banking channels.
“Governments can leverage this to increase access to financial services in rural and underserved communities, by providing the requisite digital infrastructure and learning required. Providing better opportunities to save or invest, which would increase resilience. It also encourages migrants to develop productive assets in their home countries that can be managed from abroad,” said Charioui.
Using international digital money transfer platforms like WorldRemit, Lebanese migrants can contribute to the well-being of their family members and increase the overall value of remittances as development finance. For those unbanked individuals, access to international remittance solutions becomes essential in allowing them to take care of daily needs and pay bills.
Sources:
- UN. International Day of Family Remittances 16 June. 2022
- UN. International Day of Family Remittances 16 June. 2022
- Family Remittances. 2022
- World Bank Blogs. Money sent home by workers now largest source of external financing in low- and middle-income countries (excluding China). 2019
- KNOMAD. Resilience Covid-19 Crisis through a Migration Lens. 2021
- “Millions of arrivals and billions of dollars”… Lebanon “catches its breath” during the tourist season. Al Hurra. June 2022. (Arabic)
- ESCWA Warns: Three-quarters of Lebanon’s residents plunge into poverty. UNESCWA. September 2021
- Shocking figures about immigration… Lebanon is bleeding its “human capital” on the impact of the crisis. Al Hurra. December 2021. (Arabic)
About WorldRemit
We’re a leading global payments company and, along with Sendwave, part of Zepz, a group powering two global payments brands.
We disrupted an industry previously dominated by offline legacy players by taking international money transfers online – making them safer, faster and lower-cost. We currently send from 50 countries to recipients in 130 countries, operate in more than 5,000 money transfer corridors worldwide and employ over 1,200 people globally.
On the sending side WorldRemit is 100% digital (cashless), increasing convenience and enhancing security. For those receiving money, the company offers a wide range of options including bank deposit, cash collection, mobile airtime top-up and mobile money.
Backed by Accel, TCV and Leapfrog – WorldRemit’s headquarters are in London, United Kingdom with regional offices around the globe.