Informal Remittance Flow Estimation

UNCDF’s objective in working in the area of informal remittances is to (i) better understand the evolving literature and propose methodologies and/or tools that the central banks can apply; (ii) assess the impact of informal remittances on the balance of payments focusing on informal remittance data, channels and policy responses; and (iii) make a case for the private sector and financial service providers being better able to serve migrants and their families as viable customer segments towards formal financial services. Given the size and importance of informal remittance flows, this Briefing Document aims to set out UNCDF’s rationale and strategy for estimating informal remittances. This document outlines (i) the key concepts and issues surrounding informal remittances, specifically how central banks and national statistics offices can better address them; and (b) the rationale and way forward for UNCDF’s ongoing work on informal remittances with least developed countries (LDCs) based on identified gaps and limitations in remittance data capture.