UAE remittances: 7 in 10 people expect to send more money next year

Citizens and residents of the UAE expect to transfer more money internationally in the next 12 months and a majority tend to remit more when their currency weakens against the dirham, according to a study released by Western Union.

Based on responses from more than 1,000 UAE-based citizens and residents, the survey findings revealed that 76 per cent of consumers who send money and 75 per cent of consumers who receive money, respectively, expect to transfer and collect even more funds over the next year.

Family support is highlighted by 60 per cent of senders as the primary reason for transferring money overseas followed by saving for the future. Furthermore, as increased living expenses and global currency fluctuations create additional pressure on personal finances, 74 per cent stated that because of a higher cost of living in the country they send to, they need to transfer more money.

Exchange houses officials told Khaleej Times earlier this week that remittances from the UAE have seen very healthy double-digit growth in 2022 to traditional markets such as the Indian subcontinent and Africa due to the dirham’s appreciation against foreign currencies.

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According to the World Bank figures, outward remittances from the UAE totalled $47.54 billion (Dh174.5 billion) in 2021 as compared to $43.34 billion in the previous year, an increase of 9.7 per cent.

Majority remit more when the currency depreciates

Around 71 per cent stated that they take the opportunity to send more money when the currency value falls in their receiving country.

“To remit is often a very personal decision. The data also supports that one of the most common reasons why consumers remit is to support loved ones and family,” said Jean Claude Farah, president of Middle East and Asia Pacific at Western Union.

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“So it is only natural that as the global economic climate challenges affordable ways of living, family support takes precedence over everything else as senders move money.”

Farah added that the UAE will continue to ride the top spot as one of the biggest senders of remittances in the world.

In an interesting reversal of this trend, 37 per cent of UAE consumers who receive money transfers say frequency and amount is influenced most strongly by festive and other special occasions, ranking higher than family needs or the timing of their sender’s paychecks.

“We understand that diverse populations have equally diverse needs. Festive seasons and special moments are a great example, whereby every year, we see an uptick of approximately 6 per cent in the volume of remittance transactions as these occasions approach,” Farah said.

waheedabbas@khaleejtimes.com

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