Foreign remittance

Definition of 'Foreign remittance'


A transfer of money from a migrant worker to their families or other individuals in their home countries. In many countries, remittance constitutes a significant portion of the GDP (up to a third in some cases). The United States is the leading source of foreign remittances, followed by Russia and Saudi Arabia. The top recipients are India, China and the Philippines. So much money is being remitted, the G8 and the World Bank are attempting to monitor and regulate remittance costs. 

Investopedia explains 'Foreign remittance'


According to social scientists, since it's so widespread, remittance has implications that extend beyond individual finance. For example, since remitting involves financial institutions, people who send and receive remittance are likely to have bank accounts, which promotes economic development. Remittances can be lifesaving in emergencies, such as natural disasters and armed conflicts, when the recepients' other sources of income disappear. Remittance payments are difficult to track, and there is some concern that they can be used in terrorist financing or money laundering.



comments powered by Disqus
Hot Definitions
  1. Degree Of Financial Leverage - DFL

    A ratio that measures the sensitivity of a company’s earnings per share (EPS) to fluctuations in its operating income, as a result of changes in its capital structure. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in earnings before interest and taxes (EBIT).
  2. Jeff Bezos

    Self-made billionaire Jeff Bezos is famous for founding online retail giant Amazon.com.
  3. Re-fracking

    Re-fracking is the practice of returning to older wells that had been fracked in the recent past to capitalize on newer, more effective extraction technology. Re-fracking can be effective on especially tight oil deposits – where the shale products low yields – to extend their productivity.
  4. TIMP (acronym)

    'TIMP' is an acronym that stands for 'Turkey, Indonesia, Mexico and Philippines.' Similar to BRIC (Brazil, Russia, India and China), the acronym was coined by and investor/economist to group fast-growing emerging market economies in similar states of economic development.
  5. Pension Risk Transfer

    When a defined benefit pension provider offloads some or all of the plan’s risk – e.g.: retirement payment liabilities to former employee beneficiaries. The plan sponsor can do this by offering vested plan participants a lump-sum payment to voluntarily leave the plan, or by negotiating with an insurance company to take on the responsibility for paying benefits.
  6. XW

    A symbol used to signify that a security is trading ex-warrant. XW is one of many alphabetic qualifiers that act as a shorthand to tell investors key information about a specific security in a stock quote. These qualifiers should not be confused with ticker symbols, some of which, like qualifiers, are just one or two letters.
Trading Center