Remittance is expatriates send money to Nigeria to families in rural areas of the country. Poverty is more prevalent in Nigeria’s rural areas as a result of dwindling and unequal distribution of real income. Remittances (money and goods sent home by migrants) will help people get out of poverty. However, the impact of remittances on poverty and income inequality in Nigeria has not been adequately reported.
The effect of internal remittances (from Nigeria) and international remittances (money transfers to Nigeria from Africa and other nations) on rural poverty in Nigeria The socioeconomic characteristics revealed that households receiving foreign remittances had older heads (61.7 19.7 years), smaller families (4.0 2.5), larger land area (18.5326.5 ha), higher literacy rate (0.50 0.5) and non-poor (0.08 0.3), and higher annual per capita expenditure (111,768 179,868). Both forms of remittances decrease the level, depth, and severity of poverty in rural Nigeria, according to a poverty report. The extent of the poverty reduction, however, is determined by how poverty is calculated.
Despite the fact that Nigeria is a high remittance-receiving country, evidence in the literature suggests that poverty and income inequality have increased in Nigeria over the last two decades. More than likely, only a tiny percentage of the population has access to service to receive and send money to Nigeria online, so rising remittances has little impact on poverty. Poverty has been on the rise in rural areas for a long time, and it has been a source of concern for policymakers. Poverty, for example, rose from 28.1 percent in 1980 to 46.3 percent in 1985.
How Can Nigerian Government Balance The Flow Of Remittance All Over The Country To Reduce poverty?
It may seem counterintuitive, but the poorer an individual is, the more complicated their financial situation becomes. In comparison to people at higher levels of the economic pyramid, they often pay a considerably higher percentage of their overall income for financial services.
Around 80% of the world’s poor are unable to access even the most basic financial services offered by banks and other financial institutions. Consequently, they are forced to depend on a costly, dangerous, and inefficient cash-based scheme. If the world is to assist the developing countries in lifting themselves out of poverty, they need accessible, low-cost financial services that enable them to efficiently protect and use their financial resources, manage variable cash flow, and provide a buffer for financial emergencies. Online money transfers to Nigeria, especially in the country’s rural area, can reduce the economic cost of citizens and drastically reduce poverty.