Remittances are now sent to the Philippines by moneygram and wire transfer as well as traditional means through the big banks. A remittance is a transfer of money, often by moneygram or wire transfer, by a foreign worker to his or her home country and for the Philippines economy is a significant foreign currency earner.
Remittances are playing an increasingly large role in the economies of many countries including the Philippines, contributing to economic growth and to the livelihoods of less prosperous people (though generally not the poorest of the poor). According to World Bank estimates, remittances worldwide totalled $414 billion in 2009, of which $316 billion went to developing countries that involved 192 million migrant workers. For some individual recipient countries, remittances can be as high as a third of their GDP. As remittance receivers often have a higher propensity to own a bank account, remittances promote access to financial services for the sender and recipient, an essential aspect of leveraging remittances to promote economic development,whether they are sent by moneygram or wire transfer.
According to the World Bank Study, the Philippines is the second largest recipient for remittances in Asia. It was estimated in 1994 that overseas workers sent over $2.6 billion back to the Philippines through formal banking systems. With the addition of money sent through moneygram, wire transfer, private finance companies and returning migrants, the 1994 total was closer to US6 billion annually. Looking at current remittance flows, the total is estimated to have grown by 7.8 per cent annually to reach $21.3 billion in 2010. Remittances by moneygram or wire transfer are a reliable source of revenue for the Philippines, accounting for some 8.9 per cent of the country’s GDP.
More recent statistics show that Remittances from the UK to the Philippines from January to May 2012 were up 2.78% from same period in 2011, to US$ 392 million. This means that very soon the annual remittances from the UK to the Philippines will be in excess of $1 billion. This is a significant component of the trade balance between the UK and the Philippines offering opportunities for novel wire transfer, moneygram and money exchange processes.
Because remittances are such big business the means of transferring money around the world is a competitive business with new forms of moneygram or wire transfer competing with the established big banks. Despite the current global economic difficulties, remittances using moneygram and wire transfer from overseas workers are expected to continue to increase.