Unleashing International Remittances - Technology Driven Solutions for Indonesia
Year: 2016
Type: preprint
Abstract: There are 3.6 million Indonesians working across the world. In 2015, they remitted USD 10.5 billion to Indonesia i.e., approximately 1% of the GDP. This hard earned money greatly contributes towards the welfare of dependent family members and to the overall economic development of the communities. Despite the large amount of remittances, barriers persist at both the sending and receiving ends. From a customer’s perspective, cost remains the biggest constraint for remitting money. Analysis done by MicroSave suggests that the average cost of sending money to Indonesia is 4.72%. Apart from cost, time taken to transfer and accessibility of cash-in/cash-out points are the other key issues that customers face. Keeping the issues/barriers in mind, this policy brief analyses four models that are tailored to the Indonesian context. These models have the potential to stimulate economic development of migrant communities, which is one of the key objectives of the Government of Indonesia. It also provides key recommendations for regulators and market players to operationalise the remittance business models. If implemented well, these models can lead to annual savings of USD 230 million for Indonesian migrant workers. Clearly, a win-win proposition that requires unified effort from all stakeholders.
Source: SSRN Electronic Journal
Authors: Ghiyazuddin Ali Mohammad, Disha Mohinani
Institution: MicroSave
Language: English
Topic: Migration and Labor Dynamics
Subfield: Sociology and Political Science
Field: Social Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2527342017