According to research, between five and seven per cent of Europe’s GDP comes from remittances. This highlights just a small part of why migrant workers are vital for the domestic economies of countries all over the world.
While the average migrant worker in Europe sends £8,000 to their home countries per year, remittance companies tend to charge over the odds for converting currency. This makes it harder for migrants to provide adequate support for their families. In addition, the refugee crisis is threatening their ability to do so at all.
Europe has more than 30 million migrants and counting. The vast majority contribute greatly to the economies of the countries in which they work. Yet the refugee crisis is further threatening the contribution they make…
International payments are vital to people abroad
People often move to Europe due to poor economic conditions in their home countries. In the case of Syrian refugees (for example), those facing financial hardships and very real physical danger emigrate to create a better life for themselves and their families back home.
The money the migrant workers send home is a vital contribution to their families’ welfare.
What they’re finding however, is that much of their cash, 29% as much in cases, is swallowed up by fees, meaning not only are they paying taxes in their respective nations but their also getting charged on where they send that money.
Many are looking to alternatives. Despite promises at the G8 summit back in 2009 that those fees would be lowered, migrants are still charged over the odds. Rather than using banks, where they are encountering these high charges, they are using money transfer companies such as TransferGo which offer much lower fees for transferring.
It could be the moment which does spark a bit of a revolution in the market. And it’s needed too.
Migrants are equally vital to our economy
Here in the UK migrants dominate mid-level jobs in the production, manufacturing and service industries. They often do the jobs that those native to this country are reluctant to take on. Not only do they perform a vital role for different businesses, but they also pay their tax and national insurance, which in turn is beneficial for the country as a whole. So why should they have to take a significant amount out of their disposable income simply to send money elsewhere?
Conclusion
A large amount of the money that migrants send home to their families is drained away by transaction fees for international payments. There is a need to provide more access to the market and to foster innovation, while creating a framework to protect consumers. With people in dire need, it is important to increase efficiency.
There’s the beginnings of a revolution you can feel; competition is needed if the major players are going to stop charging whatever they feel. New lower rates will force them to drag theirs down creating a much more competitive, and more importantly, fairer market.
