29 Mar 2024
Driven by unemployment and poverty, the number of Pakistan migrants worldwide is over 9 million, a report by Pilot Guides stated. In the past couple of years alone, around a million Pakistanis migrated to developed countries to find employment to earn a living and send money to Pakistan to offer financial support back home.
Since Pakistan is a weak economy, it is heavily dependent upon remittances. This is one of the reasons that the respective governments in the country have launched several initiatives to facilitate the flow of inward remittances.
Do you know what these initiatives are and how they impact inward remittances? How do these initiatives impact the future of remittances to Pakistan?
As a Pakistani migrant working abroad, you need to know about the future of remittances in Pakistan and what you should expect in 2024.
Let’s dive deeper into it and understand it together.
But first, let’s look at some reasons why Pakistanis travel abroad.
To understand the future of remittances to Pakistan, you first need to know the prime reasons and factors that drive people to developed countries for work because these reasons provide you with the necessary background.
Since the global economy is shrinking fast, it is bound to impact Pakistani migrants living in different countries who want to earn a living and send money online to Pakistan to offer financial support back home. The impact of the shrinking global economy on migrants has already been witnessed, as a World Bank report said that the quantum of inward remittances to Pakistan in 2022 was $29.87 billion, lower than it was in 2021.
This drop in remittances is straining individual households and the overall economy, driving more people out.
A deputy governor of the State Bank of Pakistan (SBP) stated that the level of misery index in Pakistan has risen from 15.2 to 36.8 in recent years. Remember that the misery index is the country's total inflation and unemployment rates.
The recently concluded census 2023 puts Pakistan’s population at 241.499 million. The population growth rate is 2.55%, which is the highest in the region. The population growth rate means that about 6 million people are added to the population annually.
Such a huge population and growth rate strain the country beyond its strength, leading to financial challenges for the country and its people.
Let’s now look at some initiatives the Pakistani government has taken to increase and facilitate the flow of inward remittances to the country.
The government has taken several initiatives in the past and is continuing to launch further initiatives. However, the primary one is the Pakistan Remittance Initiative (PRI). Look at PRI and some other initiatives below.
The first initiative the government of Pakistan took was the launch of the Pakistan Remittance Initiative (PRI). It was a joint venture by the State Bank of Pakistan (SBP), the Ministry of Finance (MoF) and the Ministry of Overseas Pakistanis (MOP).
It had the following objectives:
To avoid high taxes and to escape government regulations, you normally try to find ways to transfer funds in which you have to pay little tax. Here comes the role of Hundi and Hawala.
The Pakistani government launched a crackdown on these operators so that Pakistani migrants use legal and regulated channels for their every money transfer to Pakistan to offer financial support back home.
The government of Pakistan is also encouraging and supporting legal money transfer channels by creating a business-friendly environment so that the companies can establish themselves in the country.
As a result of this initiative, one of the leading online money transfer services, ACE Money Transfer, has a ubiquitous presence across the country and worldwide, allowing you to send money to Pakistan from abroad in just 7 seconds!
Let’s now look at the inward remittances to Pakistan and what you can and should expect in the year ahead.
Given the ever-evolving landscape of migrants in foreign countries, be they Pakistanis or otherwise, nothing remains static or fixed when it comes to remittances. If the exodus is on the rise, you will have to make a different set of preparations than if it were on the decline.
Because the circumstances, particularly political circumstances, in countries like Pakistan keep fluctuating rapidly, leaving little margin for you to prepare for the fast-occurring changes.
You can, however, expect and prepare for the following in the year 2024.
With the rise in the number of Pakistani migrants abroad, it can be stated with a degree of certitude that the quantum of remittances will only rise. Although the current statistics point to the contrary, many see the massive exodus as a silver lining.
Different reports have suggested that about 1.5 million Pakistanis left the country for greener pastures in 2022 and 2023. As the country marches into the future, with political instability in the country remaining constant, you can expect more and more people to leave Pakistan for foreign countries for better employment opportunities to earn a sustainable income for better and increased financial support to their families back home.
In this context, you should expect a rise in the quantum of inward remittances, which will require appropriate measures to attend to and prepare for an avalanche of inward remittances to Pakistan.
Since the number of Pakistani migrants abroad is only rising, more legal channels are needed to cater to the financial needs of the migrants. Therefore, you can expect the establishment of more financial institutions offering you a diverse set of services and products to choose from.
It is becoming essential over time because otherwise, the available channels will be unable to attend to the diverse needs of Pakistani migrants living abroad. Because the number of available service providers is sufficient for the existing number of migrants and the existing quantum of remittances.
Although easy access to illegal remittance transfer channels can play a role in this context, given the risks involved, can you afford to reach out to an unlawful channel?
Well, the answer is pretty simple and obvious! Wouldn't you agree?
As was done through the PRI initiative, you can expect the opening of more investment opportunities as a Pakistani migrant living abroad. These investment opportunities are meant to make Pakistani migrants invest in opportunities in their native country instead of using their capital elsewhere for other purposes.
What will the government do with an increase in the quantum of remittances? Therefore, as soon as the remittances spike, you can expect more and more investment opportunities to open up in several fields in the country.
With dazzling technology overshadowing every aspect of life, in the year 2024, you can expect more efficiency and precision in your online money transfers. The reason is that several service providers are integrating the latest technology in their remittance transfer operations.
Remember that every single migrant has unique needs and demands from their respective service providers when sending money online from abroad.
Therefore, to address these unique and disparate online money transfer demands, service providers must ensure the provision of more effective and efficient online money transfer services to their customers. So, service quality and efficiency increase is imminent in 2024.
You may be more conscious about something else than you are about the safety of the funds you send online. So, you can expect more security of your funds as the service providers, as well as the migrants, are fairly wary about the safety of funds and online transactions.
It is simply because, in online money transfers, your hard-earned money is involved in going abroad and undertaking the hazards of an expatriate life away from your family and friends.
When you look for an online money transfer to Pakistan, make sure to find a service provider that keeps evolving with the changing times and customers’ needs.
For this, ACE Money Transfer is your safest bet as you get financial benefits like live and market-competitive exchange rates, safety, and much more for a low fee and a transfer speed of just under 7 seconds!
Furthermore, the service provider is cognisant of the needs and requirements of Pakistani migrants and, therefore, keeps evolving with each tick of the clock in terms of integrating dazzling technology in its services to offer convenience and comfort in every aspect of online money transfers back to Pakistan from abroad.
Millions of Pakistanis have been traveling to developed countries like the UK, Canada, Europe, and so on to find better employment opportunities and high-quality education, both of which are hard to find in Pakistan.
Some of the critically important factors that drive millions of Pakistanis abroad are the failing Pakistani economy, dropping remittances, a rise in the level of the misery index, and a burgeoning population. All these factors make it difficult for the government to provide for the people.
The Pakistan Remittance Initiative (PRI) was an initiative taken by the SBP, Ministry of Overseas Pakistanis and Ministry of Finance. It aims to facilitate the fast and efficient flow of inward remittances and to create more investment opportunities for overseas Pakistanis.
Some important initiatives the Pakistani government has taken to facilitate inward remittances are PRI, crackdown on Hundi and Hawala, easing tax regulations, and supporting legal channels. These are meant to establish their presence to facilitate inward remittances.
You should expect and be prepared in 2024 for a rise in the quantum of inward remittances, establishing more legal channels and investment opportunities for Pakistani migrants. It aims to make more efficient remittance transfers and enhance the safety of funds and transactions.
Resources
(The Pakistani Diaspora – PILOT GUIDES)
(GDP (current US$) - Pakistan | Data (worldbank.org)
(GDP per capita (current US$) - Pakistan | Data (worldbank.org)
(Personal remittances, received (current US$) - Pakistan | Data (worldbank.org)
