Expert says COVID-19 will impact remittances to CaribbeanTuesday, April 28, 2020
DENVER, United States (CMC) – A senior official of WorldRemit, the London-based digital money transfer company, says overall remittances to the Caribbean will be severely impacted this year as a result of the novel coronavirus disease (COVID-19) pandemic.
Daniel Canning, the managing director for the Americas, including the Caribbean, at the London-based FinTech company, said while it is too early to understand the full impact of COVID-19 on remittance flows to the Caribbean, “we expect that overall remittances will be impacted in 2020”.
Canning, who is based at WorldRemit's office in Denver, Colorado, gave no figures but told the Caribbean Media Corporation (CMC) that his company is “seeing an increase in new customers and sending patterns from the digital channel, as customers opt for the convenience and safety of sending money directly from their computer or smartphone”.
WorldRemit currently services Anguilla, Antigua and Barbuda, Barbados, British Virgin Islands, Cayman Islands, Dominica, Dominican Republic, Grenada, Haiti, Jamaica, Montserrat, Puerto Rico, St Kitts and Nevis, St Lucia, and the Turks and Caicos Islands.
Canning said WorldRemit's advice to Caribbean customers is to “consider sending and receiving money digitally for a safer experience.
“In the global economic downturn that we are beginning to experience, offering superior value and competitive pricing to consumers is critical for money transfer companies like WorldRemit,” he said.
Family remittances to Latin America and the Caribbean grew by approximately eight per cent in 2019, compared to 2018. This marks a slowing trend in remittance growth that began in 2017.
Experts say this slow remittance growth may have implications for economic performance in several Latin American and Caribbean countries given that remittances represent a notable share of gross domestic product (GDP) for the most politically unstable countries in the region.
Last week, the World Bank predicted the sharpest decline of remittances to Latin America and the Caribbean, saying that global remittances on a whole are projected to decline sharply by about 20 per cent this year, 2020, due to the economic crisis induced by the COVID-19 pandemic and shutdown.
“The projected fall, which would be the sharpest decline in recent history, is largely due to a fall in the wages and employment of migrant workers, who tend to be more vulnerable to loss of employment and wages during an economic crisis in a host country,” said the Washington-based financial institution in a statement.
The World Bank estimates that remittances to low and middle-income countries in 2020, will recover and rise by 5.6 per cent to US$470 billion.
“The outlook for remittance remains as uncertain as the impact of COVID-19 on the outlook for global growth and on the measures to restrain the spread of the disease,” the bank said.