Cost Of Sending Money Eats Into Global Remittances
WorldRemit, a leading digital remittances company, announces the results of its second Cost of Living Index, where the organization has…
WorldRemit, a leading digital remittances company, announces the results of its second Cost of Living Index, where the organization has sought to understand how the worsening inflation crisis has affected the lives of international money senders around the world.
82% of remittance senders, including Kenyan migrants who are key remittance senders in the US, Australia, and UK markets, agreed that the cost of living for the people to who they send money has risen since the start of the year.
Highlighting the impact of inflation on people around the world, almost half (45%) noted they now only send money to immediate family, rather than friends and distant relatives.
1 in 9 people worldwide relies on money sent from friends and relatives who have migrated abroad for work. With several factors contributing to increased financial pressure, new data showed that 72% of respondents in the US, 41% in Australia, and 44% in the UK have taken up a side hustle (a job in addition to their main source of income), with 27% of respondents on average across our three markets indicating they did so to support the increase in their own cost of living.
Of the respondents who cited having a side hustle, 89% reported that they would maintain their side hustle in the next 12 months.
Households around the world are set to re-examine their spending habits in light of inflation, with more than a quarter of respondents (26%) saying that they are curtailing discretionary spending on entertainment such as dining out or going to the cinema or theatre. For example, in the UK (65%) of people noted concerns regarding the cost of utility bills, highlighting the change in spending habits of UK households as a result of the energy crisis.
“The inventive solutions, such as side hustles, that we are seeing as a result of the current economic landscape point to the resilience of migrants and their commitment to financially supporting loved ones overseas,” said Ivan Kanyali, Regional Manager East Africa, WorldRemit. “These findings demonstrate the grit of economic migrants in adapting to wider financial stresses and the rising cost of living while still meeting the needs of their families at home, and abroad.”
The WorldRemit multi-country study was fielded in October 2022 to determine the ongoing effects of the increased cost of living on international money senders in the United States, United Kingdom, and Australia, resulting in observations from 2,687 international remittance senders. Whilst there were minor differences, broadly speaking, 1st generation migrants’ views were aligned with those of the overall sample in our survey.