The phenomenon of migration from third world to first world countries has been growing for many years now. In 2005, it was estimated that international migrants reached 200 million and that women constituted almost half of all migrants (INAFI Proposition 2007, Microfinance and Remittances). These international migrants sent home some USD 232 billion in 2005. Latin America ranks as the highest remittance recipient with 30% of the total worldwide remittances, while South Asia ranks a close second with 20%.
Remittances have significantly contributed to the GDP of most Asian countries like Philippines, Nepal, China, Bangladesh, India and Pakistan. Remittance has been the unchallenged contributor to Nepal’s GDP (19%), particularly as the country faces political and economic instability. Unfortunately, in Nepal, remittance is directed primarily towards unproductive consumption. Redirecting this resource to productive ventures for social development will not just benefit the migrant communities but larger communities as well by generating employment and income.
INAFI Nepal has conducted various studies and workshops to share experiences and findings among microfinance practitioners on the most effective ways to utilize remittance for productive purposes.