Remittance

A remittance is a non-commercial transfer of money by a foreign worker, a member of a diaspora community, or a citizen with familial ties abroad, for household income in their home country or homeland. Money sent home by migrants competes with international aid as one of the largest financial inflows to developing countries. Workers' remittances are a significant part of international capital flows, especially with regard to labor-exporting countries. Due to its large diaspora, India consecutively remains the top receiver of remittance. In 2022, the top five recipient countries for remittances inflows in current USD were India (US$100 billion), Mexico (US$60 billion), China (US$51 billion), the Philippines (US$38 billion), Egypt (US$32 billion) and Pakistan (US$29 billion). Remittance has been defined by the World Bank as the part of the earnings, which a migrant worker sends back to family members in the country of origin. World wide the flow of remittance has increased from US$72.3 billion in 2001 to approximately US$483 billion in 2011. According to the World Bank, in 2018 overall global remittance grew 10% to US$689 billion, including US$528 billion in 2019 to developing countries. Overall global remittance is expected to grow 3.7% to US$715 billion in 2019, including US$549 billion to developing nations. Economic research has focused on the motivation for remittance, suggesting that the key drivers for remittance are altruism, self-interest in exchange, and repayment of past expense. A mix of motivations may coexist, in scientific literature this state of mind is sumarised as "tempered altruism and enlightened selfishness". Remittances make up a significant portion of economies of developing countries. Many receive over 10% of their gross domestic product (GDP) in remittances each year, with some exceptional cases as high as a third of their GDP. International remittances have a major impact on developing countries around the world because the majority of remittances, some $441 billion in 2015, goes to developing economies.