Supporting family and friends can be one of the most important and rewarding experiences in life. Whether you are a parent, spouse, child, sibling, or friend, looking after one another is one of the most basic and fundamental of all human traits.
Providing for friends and family can take many forms, from emotional and practical support and advice, to providing financial stability for loved ones. For many migrants who move to Australia, being able to support their family by sending money is one of the primary reasons why they choose to relocate; to help provide, and to offer a better life for their loved ones.
Our new report – The Value of Remittance – looks to shed light on the real-world impact of remittance payments and how migrants and global money transfer is helping to make a difference to the lives of families across the world.
What is remittance?
‘Remittance’ originates from the word ‘remit’, which means ‘to send back’. A remittance is essentially a transfer of funds between two parties. While it can encompass various types of monetary transfers, it typically describes sending money to another country. This usually involves sending funds to family members living overseas, whether as a gift, or a contribution towards household bills.
Remittance payments are a vital lifeline to many
Our research found that for many families of migrants living in Australia, remittance payments are a crucial helping hand that can have a significant impact on their quality of life. Our study found that over half (51%) of migrants living in Australia believe their friends or family would be in poverty if it wasn’t for them sending regular payments back home and that 57% state that members of their family would not be able to afford medical treatment.
Our study, which surveyed migrants living in Australia, demonstrates the positive affect that remittance payments have on families around the world. The report found that 79% of migrants believe that their family’s quality of life has improved vastly due to the money that they send and 77% believe that their family and friends have more opportunities in life as a result of their remittance payments.
How much do migrants send home?
On average, migrants were found to send 11% of their annual income home as remittance.
What are remittances used for by families of migrants living in Australia?
The primary reasons stated were being able to being to contribute towards their family’s food bill (67%), healthcare costs (60%) and accommodation (42%). 92% of migrants were found to have sent money to family back home in the past 12 months and 67% of migrants state that being able to send money to family back home was a key factor in their decision to move to Australia.
The most common uses of remittance amongst families of migrants:
- Groceries (67%)
- Healthcare (60%)
- Accommodation (42%)
- Education (42%)
- Paying off family debt (33%)
- Transport costs (28%)
- Paying towards family childcare (20%)
- Supporting a family members business (15%)
- Paying towards family wedding costs (15%)
How is remittance being used by friends of migrants living in Australia?
Many migrants were also found to send remittance to their friends too, with the primary reasons being to support with the cost of education (63%), healthcare (58%) and groceries (57%). 60% of migrants stated that their friends rely on the money that they send.
The most common uses of remittance amongst friends of migrants:
- Education (63%)
- Healthcare (58%)
- Groceries (57%)
- Accommodation (55%)
- Paying off a friend’s debt (43%)
- Paying towards wedding costs (28%)
- Transport costs (26%)
- Paying towards childcare (21%)
- Supporting a friend’s business (9%)
The pressure of providing back home
Our study found that amidst rising inflation, many migrants are struggling with the pressure of providing for their families and friends back home.
Over half (56%) of migrant’s state that they have had to work extra hours or have started another job to continue sending remittance payments and 62% say that they have had to reduce the amount of remittance that they send due to rising living costs. Over half (52%) also reported that they were concerned about the possibility of losing their job in the next 12 months and the impact this will have on their families back home.
Top 10 countries migrants living in Australia are sending money to:
- India – how to send money to India
- China – how to send money to China
- Philippines – how to send money to the Philippines
- Vietnam – how to send money to Vietnam
- United Kingdom – how to send money to the UK
- Lebanon – how to send money to Lebanon
- Thailand – how to send money to Thailand
- France – how to send money to France
- Germany – how to send money to Germany
- Italy – how to send money to Italy
(Source: KNOMAD/World Bank Bilateral Remittance Matrix)
Our research found that this pressure is having a profound strain on the mental wellbeing of migrants living in Australia. 69% percent state that the responsibility of having to support their family or friends can sometimes be too much to bear, and the same percentage of migrants also say that they regularly make sacrifices in their own life to ensure that they are able to continue sending money to their friends or family. 58% also reported that they often feel lonely, suggesting many migrants are prioritising work over building their own personal relationships.
Despite this, 81% of migrants of state that the fact that they are able to send money to their friends or family gives their life a sense of purpose and almost three-quarters (73%) of migrants say that without having moved to Australia they may not have been able to support their friends or family financially at all.
Trusting the right provider with your transfer
Choosing the right money transfer service is crucial when sending remittance, as it can make all the difference in ensuring that hard-earned money reaches family and friends quickly and securely. The thought of their loved ones being left without the support they need is devastating for many migrants, which is why selecting a trustworthy provider carries immense weight for many.
We asked which factors are most important when it comes to transferring money, and the responses showed the following order of priorities:
- Security of transfer
- Speed of transfer
- Convenience of sending money
- Ease of using the service
- Convenience of receiving the money
- Cost
- Being able to do it online
- Being able to do it in person
For more information on international money transfer, please visit our advice page or find a location near you.
