The funds sent by foreign workers to their home country are named as remittances. These remittances are important to the economic growth of a country. That is why the greatest remittance receiving countries tend to formulate new policies in order to boost and secure the remittances. In order to know the importance of remittances, we can discuss the two well-analyzed considerations of remittances.
Firstly, Remittances are the most known way of income for poor families living in developing countries. Economies suffering from unemployment mostly seek jobs out of the country. These funds are important to maintain the well-being of families.
Secondly, remittances are very helpful during the need for disaster relief. Less developed nations also highly rely on remittances for such purposes. Remittances also raise the number of foreign reserves which is one of the greatest benefits taken from foreign funds.
Transparency in Tracking Remittances
it is crucial to keep in view the transparency and security issues regarding the remittances. the mechanisms used by states to keep records of the amounts of money people are receiving is very rarely made public. However, the majority of such transfers are done online, making it more easy to be tracked.
Regarding transparency and recording, the field of remittance has given rise to various problems of money laundering and harmful terrorist activities.