Main area: Migration
Theme: Engagement with diaspora
Assessment: ODA-eligible
Provider country: Switzerland
Recipient country: Senegal, Ethiopia, Myanmar, Nepal, Bangladesh
Implementing agency: UNCDF
Budget (CHF million): 7.6
Year(s): 2019-2023
Purpose code: 24040:20|15190:30|24050:50
Case number: Migration / 23
Innovative financial solutions to enhance the development impact of remittances
More than 280 million people are migrants. Most come from countries in the Global South and migrate to other countries in the South. Many of them send money back home (remittances). Around USD 700 billion USD in remittances are sent every year. The majority goes to low- and middle-income countries. These payments are important not only for individual families, but also for the countries of origin: they contribute to economic stability and to sustainable development. Remittances' potential positive impact on sustainable development is not yet fully exploited. This is primarily due to (i) high transfer costs, (ii) large amounts of informal transfers that bypass the formal financial system, and especially (iii) the fact that migrants and their families are underserved in terms of financial inclusion and economic integration products.
The overall goal of the programme with UNCDF is to improve the financial resilience and economic inclusion of migrants and their families, through low-cost digital remittance services and remittance-linked financial products with a view to contributing to the sustainable development of countries of origin in the Global South.
Customer Outcome: Migrants and their families have access to low-cost digital remittance services and financial products and have the required financial literacy to meaningfully use these services.
Stakeholder Outcome: Remittance and financial service providers apply new business models and use new delivery channels to serve migrants and their families as customer segment, and benefit from diversified revenues from cross-selling opportunity and improved sustainability.
Sector Outcome: Reduction in remittance transaction costs in selected corridors, and increased flow of remittances.
5 pilot countries are targeted: Ethiopia, Senegal, Bangladesh, Nepal and Myanmar
The programme is currently being implemented. Preliminary results are:
9 Private sector partners are supported to develop migrant-centric and gender-responsive remittance products and services.
4 Public sector stakeholders (incl. Central Banks) supported in domestic and cross-border remittance policy framework development.
186 000 (35% women) total number of customers reached.
This activity is deemed ODA-eligible. It facilitates remittance transfers and the larger financial inclusion of migrants and their families, thereby contributing to their resilience and economic inclusion and hence to the sustainable development of migrants’ countries of origin, particularly Ethiopia, Senegal, Bangladesh, Nepal and Myanmar. Such engagement with diaspora, for the primary benefit of the origin countries, is eligible as per Criterion 8.
This work was approved and declassified by the Development Assistance Committee’s Working Party on Development Finance Statistics.
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