The International Day of Family Remittances (IDFR) is celebrated on 16 June each year and holds great significance as we recognize and celebrate the crucial contribution of over 200 million migrant workers. These hard-working individuals send money to over 800 million family members in low and middle-income countries exemplifying resilience in the face of global uncertainty. Led by the International Fund for Agricultural Development (IFAD) and the United Nations (UN), this initiative highlights the determination of low-income workers while promoting reduced transfer costs and greater financial inclusion through remittances. It also promotes the achievement of the Sustainable Development Goals (SDGs) and furthers the 2030 Agenda for Sustainable Development.
The Aim: Promoting Financial Inclusion Through Digital Technologies
The IDFR 2023-24 campaign focuses on promoting digital technologies to enhance financial inclusion and to work towards achieving the target of reducing the cost of remittance to 3% as mentioned in SDG 10.c. This goal stands for “Reducing inequality within and among countries” and point 10.c. specifically aims to reduce migrant remittance costs to the desired levels by 2030. This may be challenging for large financial institutions with legacy systems making low-income client acquisition very costly. However, not for innovative fintechs including myZoi, that are purely tech-led, digital by design, and inspired by the larger purpose of making a meaningful difference in the lives of low-income migrant workers. There is no shortage of innovative financial technologies enabling cost-efficient services while still making it a commercially viable and socially impactful proposition. Fintech should certainly tap into the latest tech solutions to bring simple yet meaningful solutions to low-income migrant workers.
Global Remittances Market: A Lifeline for a Developing World
Based on the IFAD, in 2022 alone, over 200 million migrant workers sent USD 626 billion back to their families in remittance-reliant countries in 2022.
It’s important to recognize that remittances are a lifeline to the developing world and are used to pay for basic household needs and support families. While individual remittances may be relatively small (the average remittance is USD 200-USD 300 a month), collectively, these flows are three times greater than global official development assistance.
Remittances also play a crucial role in the economies of the recipient countries. UAE-based blue-collar workers often contribute to a significant portion of the GDP of countries in South Asia, South East Asia, and Africa.
The UAE is one of the top 3 remittance-sending countries globally**. In 2020, the United States was the largest source country for remittances, followed by the United Arab Emirates and Saudi Arabia.
According to World Bank figures, outward remittances from the UAE exceeded USD 47 billion in 2021*** which was an increase of 9.7% as compared to the previous year, where a significant portion is contributed by low-income migrant workers.
The Struggle and Sacrifice
The journey of low-income migrant workers is really tough. They work tirelessly day and night to provide for and support their families back home – whether it’s their daily expenses, medical emergencies, or their child’s school fees – these remittances help them stay afloat. In UAE, many of them send over 80% of their income to their families, leaving little to no savings for themselves. At myZoi we draw inspiration from their commitment to their families and we are building something truly unique to make help them build a future that promises greater financial stability and independence.
Building a Better Future with myZoi
At myZoi, we are earnestly working on bringing the myZoi platform to life. For those who haven’t heard of it, myZoi is a comprehensive digital platform that enables payroll payout for employees, payments & transfers, tailored financial literacy solutions, and much more. Being a portfolio company of SC Ventures, we are a fully compliant digital platform that keeps clients at the heart of our solution. We work with corporates, institutions, regulators, and the larger fintech ecosystem to make a meaningful impact across multiple Sustainable Development Goals and budling a more prosperous future for our clients and their families. Join us on this journey. Visit www.myzoi.life to learn more about myZoi and our mission to empower low-income migrant workers. We are always open to feedback and eager to form new partnerships that strengthen our efforts in driving positive change.
Find this blog on LinkedIn
https://www.linkedin.com/feed/update/urn:li:activity:7075474663719485440
