According to the United Nations, roughly one billion people in the world — or one in seven — are involved with remittances, by either sending or receiving them. About 800 million people in the world — or one in nine — are recipients of these flows of money sent by their family members who have migrated for employment purposes.
Importantly, remittances help lift and keep millions of people out of poverty, with funds at times representing 60% of household incomes. Moreover, remittances are saved or invested in asset building or activities that generate income and jobs and transform economies, particularly for developing nations and in rural areas.
The dual COVID-19 and brief oil price war shocks are now expected to plunge the world into a global recession, disrupting billions of dollars of remittances flows. Our latest GDP projections may reduce remittances for 72 economies by $34.1 to $39.1 billion. In a worst-case scenario, where monetary and fiscal policies fail, remittances for these same economies might fall by nearly $100 billion.