Remittances via banks register tepid 4.2% growth at $7.3 B in Q1

By Lee C. Chipongian

Bank-channeled remittances sent home by overseas Filipinos increased by 4.2 percent year-on-year to $7.3 billion in the first three months of 2019, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno announced Wednesday.

Bangko Sentral ng Pilipinas Governor Benjamin E. Diokno. (Bloomberg photo) Bangko Sentral ng Pilipinas Governor Benjamin E. Diokno. (Bloomberg photo)

The end-March cash remittances or fund transfers coursed through the formal banking system as opposed to personal remittances, was boosted by the 2.5 percent rise in land-based overseas Filipinos’ transactions. They remitted $5.71 billion during the period. Sea-based workers, in the meantime, sent home $1.58 billion which was up by 10.8 percent year-on-year.

The BSP said the US continue to register the highest share of overall remittances at 35.1 percent but remittance data by source is limited since most correspondent banks used by remittance centers as well as money couriers are based in the US. The US would naturally appear as a major location where remittances are recorded.

Other major sources of remittances are Saudi Arabia, Singapore, United Arab Emirates, United Kingdom, Japan, Canada, Qatar, Hong Kong, and Kuwait. The combined remittances account for 78 percent of total cash remittances during the period.

For the month of March alone, cash remittances grew by 6.6 percent year-on-year to $2.5 billion from $2.4 billion same time in 2018. “Of the 6.6 percent growth in March, two, 1.7 and 1.2 percentage points were contributed by the US, Singapore and UK, respectively,” said the BSP.

As for personal remittances, the central bank reported these at $8.1 billion for the first three months, up by 3.7 percent year-on-year from $7.8 billion.
Personal remittances was first reported in 2012 and are the sum of net compensation of employees, personal transfers and capital transfers between households.

The BSP said personal remittances was driven by the steady remittance inflows from land-based overseas Filipinos with work contracts covering one year or more. These contract workers remitted $6.2 billion of personal remittances in the first quarter.

Personal remittances by both land-based and sea-based workers with short-term contracts amounted to $1.7 billion during the period.

The BSP has a modest remittances growth projection for 2019 of three percent.

Last year, cash remittances went up by 3.1 percent to $28.94 billion from 2017, while personal remittances increased by three percent to $32.21 billion.