On a global scale, inflation has been influenced by multiple factors such as the COVID-19 pandemic, fuel price increases, and the ongoing conflict between Russia and Ukraine.
Locally, its effects are felt most in consumers’ wallets when purchasing basic goods. In light of the weakening peso, the price of goods has risen exponentially.
A multi-country study was conducted on migrants’ behaviors to manage finances during inflation, and results showed that 78 percent of respondents agree that their cost of living has risen.
Among the topmost affected areas of expenses are utility costs, transport, daily living, housing, and healthcare.
On top of that, they send money to their loved ones abroad to support their day-to-day expenses.
Amid these challenges, remittances remain as one of the sources of hope for the Philippines’ consumer-driven economy as they contribute greatly to the country’s acquisition of dollars.
In the last year, remittances made up a total of $31.42 billion, which rose by 5.1 percent since 2020.
The trend of positive remittance flows is predicted to persist this year.
A report from the UN’s International Fund for Agricultural Development (IFAD) estimates that around 800 million people globally benefit from remittances.
Data from the Bangko Sentral ng Pilipinas showed personal remittances from Overseas Filipinos (OFs) reached $2.70 billion in May 2022, higher by 2.0 percent than the $2.65 billion posted in the same month last year.
This resulted in the increase of the cumulative personal remittances by 2.5 percent to $14.02 billion in the first five months of 2022 from $13.68 billion recorded in the comparable period in 2021.
BSP said the increase in personal remittances in May 2022 was due to remittances sent by land-based workers with work contracts of one year or more, and sea- and land-based workers with work contracts of less than one year.
Similarly, cash remittances coursed through banks increased by 1.8 percent year-on-year to $2.43 billion in May 2022 from $2.38 billion registered in the same month in 2021.
On a year-to-date basis, cash remittances reached $12.59 billion, 2.5 percent higher than the $12.28 billion recorded in the comparable period last year.
In terms of country source, the growth in cash remittances from the United States (US), Saudi Arabia, Japan, Qatar, and Singapore contributed largely to the increase in remittances in the first five months of 2022.
As OFWs around the world continue to send dollar remittances to their families back home, they also help the economy recover.
By sending money to the Philippines, OFWs financially support their loved ones at home and help increase their families’ capacity to spend for essentials in the midst of economic headwinds.
Thus, digital financial service providers, like WorldRemit, are important stakeholders in keeping the country’s economy afloat.
WorldRemit’s convenient, fast and secure money transfer services are important to breadwinners abroad, as well as their dependents back home.
“To cope with the hardships brought about by inflation, both sen ders and receivers of remittances can maximize the features that digital financial services provide,” stated WorldRemit’s Philippine Country Director Earl Melivo.
Many names in fintech today, including leading player WorldRemit, offer fast and safe money transfers online at a low cost and with very competitive exchange rates.
In comparison to traditional banks, their minimal fees often make them more accessible whilst better exchange rates provide more value to the OFWs’ hard-earned money for their loved ones back home.
“There are many external risks that may put people under financial pressure, but we want to remedy that by offering a better value and a wide array of options for sending money overseas,” Melivo added.
WorldRemit is a leading global payments company, disrupted an industry previously dominated by offline legacy players by taking international money transfers online–making them safer, faster and lower-cost.
They currently send from 50 to 130 countries, operate in more than 5,000 money transfer corridors worldwide and employ around 1,200 people globally.
On the sending side WorldRemit is 100 percent digital (cashless),increasing convenience and enhancing security.
For those receiving money, the company offers a wide range of options including bank deposit, cash collection, mobile airtime top-up and mobile money.
Backed by Accel, TCV and Leapfrog–WorldRemit’s headquarters are in London, United Kingdom with regional offices around the globe.
