Press Release —Global January 22, 2020

Remittance Regulatory Frameworks and Accessibility of Regular Remittance Channels of Colombo Process Member States

Press Release

Colombo, Sri Lanka

IOM has published a Study on Remittance Regulatory Frameworks and Accessibility of Regular Remittance Channels of the Colombo Process Member States (CPMS.) The research was commissioned as part of an IOM regional project: “Strengthening Labour Migration Governance through Regional Cooperation in Colombo Process Countries”, funded by the Swiss Agency for Development and Cooperation (SDC.)

This report examines remittance inflows to the CPMS and provides recommendations to remove barriers, reduce costs, enhance financial access and financial literacy. It identifies good practice examples from CPMS, as well as the main challenges experienced by CPMS’ migrants in accessing formal remittance services and provides background information on formal remittance flows, costs and main channels used, including formal and informal methods. The report provides an overview of the legal, regulatory and policy environments for remittance services in CPMS, especially on pay-out environments, regulations on digital payments and financial inclusion.

“Remittances are private money flows which can have a positive role in receiving economies and communities. For governments balancing the policy options and economic impacts of remittances as it relates to financial inclusion, creating competitive conditions for the operation of remittance service providers and harnessing the potential opportunities of digitization is important. This report provides a balanced perspective of remittance policy and regulatory considerations for CPMS countries,” said IOM Senior Migration and Economic Development Specialist Deepali Fernandes.

According to the Study, good remittance regulations in the CPMS include: having remittance regulatory frameworks in place which show the importance of remittances to countries in the region; banning exclusivity in recent years leading to greater competition, which provides more ways in which remittances can be transferred and lower prices for consumers; enabling regulations around the application of new technologies, including electronic money (e-money) and mobile money; and, financial inclusion and financial education.

But persistent problems in relation to remittance regulations include lack of legislation against exclusivity contracts in some CPMS; implementation of Know-Your-Customers disproportionately to the risk; and, a dearth of remittance-based consumer protection.

The report brings together key findings based on available data and information on remittance flows, policies and regulations in the CPMS and concludes by outlining recommendations and potential initiatives for maximizing the benefits of remittance flows for countries as well as senders and receivers.

The executive summary of the report was disseminated at workshop held at UN HQs in New York on the 14th of June 2019 to mark the International Day of Family Remittances. The workshop was jointly organized by IOM, International Fund for Agricultural Development (IFAD), United Nations Department of Economic and Social Affairs (UN DESA), GFMD and several UN member states.

The study on Remittance Regulatory Frameworks and Accessibility of Regular Remittance Channels of the Colombo Process Member States (CPMS) is available at:
https://publications.iom.int/books/study-remittance-regulatory-frameworks-and-accessibility-regular-remittance-channels-colombo

For more information, please contact the Colombo Process Technical Support Unit at IOM Sri Lanka. Email: colomboprocess@iom.int