OFW remittances extend growth streak

Dollars sent home by expatriate Filipinos rose in August and extended its uptrend to seven straight months after last year’s erratic performance due to coronavirus pandemic-induced job losses overseas.

In a statement, the Bangko Sentral ng Pilipinas 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 last year.

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 growth in personal remittances in August was due to remittances sent by land-based workers with work contracts of one year or more, which increased by 4.2 percent to $2.207 billion from $2.118 billion in the same month last year; and sea- and land-based workers with work contracts of less than one year, which grew by 8.4 percent to $629 million from $580 million a year ago,” the central bank said.

Of the personal remittances from overseas Filipinos, cash remittances coursed through banks grew by 5.1 percent to $2.609 billion in August 2021 from $2.483 billion registered in the same month last year.

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

Meanwhile, in terms of country sources, the United States 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 central bank 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.