Migrants preferring formal channels to send money home

Kathmandu / Aug. 22:Some 88 per cent of migrant workers in Nepal have said that they preferred to use formal channels, mainly money transfer services or bank transfers, to remit money.

Likewise, it has also been revealed that remittance receiving households spent less of the money on consumption than previously thought, and that more migrants now prefer to use formal channels to send money home.

According to key initial findings of a research shared in the capital today, some 39 per cent of remittances were spent on consumption, 28 per cent on savings and loan repayment, 26 per cent to purchase property, and 7 per cent to businesses.

The research was carried out by Institute for Integrated Development Studies (IIDS) and International Agency for Source Country Information (IASCI), in close coordination with the Central Bureau of Statistics and the UN Migration Agency (IOM), and was part of a project: “Research and Policy Dialogue Initiative on Migration and Development in Nepal” funded by the IOM Development Fund.

The study covered 31 districts and three ecological belts (mountains, hills and Tarai) of Nepal, and focused on data collection from Nepali households (both with and without migrants), including current migrants in Gulf Cooperation Council (GCC) Member States, Malaysia, Korea and India.

Nepal received remittances of USD 8.1 billion in 2016 and ranks 23rd among all remittance-receiving countries in the world. In terms of the contribution of remittances to GDP, it ranks third after Tajikistan and Kyrgyz Republic. Over half of all Nepali households have at least one migrant family member currently abroad or living in Nepal as a returnee.

Speaking at the two-day workshop to share the findings of a research study: ‘Maximizing the Development Impact of Migration in Nepal” that began in Kathmandu today, Ministry of Labour and Employment Joint Secretary Bhuvan Acharya expressed the belief that the data and evidence generated through the research and the consultative process would provide the government, civil and private sector entities, with solid baselines against which to formulate future policies, projects and market interventions for migration and development.

IOM Nepal Chief of Mission Paul I. Norton said the research project is based on the premise that financial, human and social wealth accumulated by migrant workers abroad are interlinked, and that this accumulated wealth has real potential to substantially impact the economic and social development of Nepal.

The meeting, which is being attended by government officials, development partners, diaspora associations, private recruitment agencies and the private sector, will contribute to Nepal’s policies on mainstreaming remittances into national development. RSS