Maximizing the impact of remittances on development
Over the past two decades, remittances have emerged as an important contribution to the well-being of migrant families and the development of communities of origin.
In 2018, over 200 million migrant workers sent US$529 billion to their families in developing countries, representing more than three times the annual flow of official development assistance (ODA) and exceeding foreign direct investment (FDI) for the first time.
In 2017, the global number of international migrants was estimated to have reached 258 million.
Remittances are a private source of capital which should not to be equated with other international financial flows. However, they can help lift millions of migrant families out of poverty, touching the lives of up to one billion people, either as senders or recipients.
Remittances, the “human face of globalization”, allow migrants and their 800 million family members to improve their access to health, education and housing, thereby helping achieve their own Sustainable Development Goals (SDGs).
What we do
Since 2006, IFAD's multi-donor Financing Facility for Remittances (FFR) aims to maximize the impact of remittances on development, and to promote migrants' engagement in their countries of origin.
Through the financing of more than 60 projects in over 40 countries, the FFR is successfully increasing the impact of remittances on development by promoting innovative investments and transfer modalities; supporting financially inclusive mechanisms; enhancing competition; empowering migrants and their families through financial education and inclusion; and encouraging migrant investment and entrepreneurship.
As a result, remittance-receiving households in rural areas are becoming more financially independent and have growing access to financial services and products.
The FFR is also an important source of knowledge on remittances: global estimates of remittances in developing countries were published for the first time in its Sending Money Home reports, and currently available on RemitSCOPE, launched in 2018.
It contributes to policy dialogue through actionable research, the Remittances Gateway web portal, and the Global Forums on Remittances, Investment and Development (GFRIDs), organized every two years in collaboration with key development organizations and other international financial institutions (IFIs).
Over the past decade, these Global Forums have brought together international stakeholders from the public and private sectors, and the civil society, involved in remittances, migration and development. Focusing on a different region each time, they aim to raise awareness, promote dialogue, stimulate partnerships and create long-lasting synergies.
Past forums were held in:
- Kuala Lumpur (Asia-Pacific, 2018),
- United Nations Headquarters in New York (global, 2017),
- Milan (Europe, 2015),
- Bangkok(Asia, 2013),
- Tunis (Africa, 2009) and
- Washington (global, 2007).
The next edition of the Forum will take place in Nairobi (Kenya) on 16 to 18 June 2021, and will focus on Africa.
The FFR also coordinated the effort towards formal adoption of the International Day of Family Remittances (16 June) by the United Nations General Assembly. The day aims to raise awareness of the fundamental contribution of migrant workers not only to their families and communities back home, but also to wider sustainable development in their countries of origin.
In 2020, IFAD launched the #FamilyRemittances campaign “Building resilience in times of crisis”, to engage public and private sector entities in supporting one billion people - migrants and their families - build resilience in these times of crisis, by taking action towards reduction of transfer costs and provision of financial services.
In early 2019, the FFR started implementation of a new initiative, the Platform for Remittances, Investments and Migrants' Entrepreneurship in Africa (PRIME Africa), aimed at maximizing the impact of remittances for millions of families in Africa, contributing to foster local economic opportunities in the migrants' countries of origin.
The FFR is cofinanced by IFAD, the European Union, the Grand-Duchy of Luxembourg, the Ministry of Foreign Affairs of Spain and the Swedish International Development Cooperation Agency (Sida).
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Every year, on 16 June, the International Day of Family Remittances (IDFR) is observed in recognition of the fundamental contribution of migrant workers to their families and communities back home and to the sustainable development of their countries of origin.
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