Strong August performance extends remittance winning streak to 7 months

Photo by Geela Garcia OJT

MANILA, Philippines—Dollars sent home by Filipinos abroad rose in August and extended its upward trend for the seventh month in a row after 2020’s erratic performance due to pandemic-induced job losses overseas.

In a statement, the Bangko Sentral ng Pilipinas (BSP) said personal remittances from overseas Filipinos rose by 4.8 percent to $2.889 billion in August 2021 from $2.756 billion in the same month in 2020.

This resulted in the increase in cumulative remittances by 5.9 percent in the first eight months of 2021 to $22.672 billion from $21.414 billion recorded in the same period in 2020.

The BSP said growth in personal remittances in August was mainly from land-based workers with one year or longer contracts whose remittances rose by 4.2 percent to $2.207 billion from $2.118 billion in August 2020. Sea-based and land-based Filipino workers with contracts of less than a year sent remittances higher by 8.4 percent to $629 million from $580 million in 2020, the BSP added.

Remittances made through banks grew by 5.1 percent to $2.609 billion in August 2021 from $2.483 billion in August 2020.

Growth in cash remittances was due to an increase in remittances from land-based and sea-based workers which rose by 4.1 percent to $2.032 billion in August 2021 from $1.952 billion in August 2020 and by 8.6 percent to $577 million from $531 million.

On a year-to-date basis, cash remittances in January-August 2021 amounted to $20.38 billion, 5.7 percent higher than $19.285 billion in the same period in 2020.

The growth in cash remittances from the United States, Malaysia, and South Korea contributed largely to the increase in remittances in January-August 2021.

In terms of country sources, the US registered the highest share of overall remittances at 40.7 percent in the first eight months of 2021, followed by Singapore, Saudi Arabia, Japan, the United Kingdom, the United Arab Emirates, Canada, South Korea, Qatar and Taiwan.

The combined remittances from these top 10 countries accounted for 78.8 percent of total cash remittances.

The BSP explained that a common practice of remittance centers in various cities abroad is to course remittances through correspondent banks, most of which are located in the US. Therefore, the US. would appear to be the main source of remittances because banks attribute the origin of funds to the most immediate source.

TSB