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Understanding the Impact of Remittances on Gambia's Growth

Understanding the Impact of Remittances on Gambia's Growth

04 Jul 2024


Ever wonder how online money transfer to Gambia contribute to its economic growth? Over 118,000 Gambians live abroad for different purposes. Most leave the country to look for better life opportunities abroad. They apply for jobs in foreign countries and settle there. Most expats are the breadwinners of their families, so they send money from abroad to Gambia to their families. Usually, expats send monthly remittances to their families when they get a salary. These remittance transfers help remittance-receiving countries and contribute to the Gambian economy.
 

Almost 22% of Gambia's GDP depends upon remittance. In the times of Covid, remittance contributed to 33%-50% of Gambia’s GDP. Remittance removes poverty from thousands of families who receive remittance monthly. Gambia is a small African country that depends a lot on foreign aid. Remittance to Gambia contributes to social empowerment and financial sector development. Remittance opens up ways for business, investment, and entrepreneurship. The following points will help you understand the role of remittance in Gambia’s growth:

Role of Remittance in Contributing to Gambia’s Growth

The inflow of remittances increases household income, and families consume more services. Expats send money to Gambia to their families and pay taxes and bills for their properties in Pakistan. All these things contribute to Gambia’s growth:

Remittance Contributes to Gambia’s GDP

Remittances contribute a significant portion of the Gambia’s economy. In recent years, remittances have contributed 22% to the country's GDP, which boosts the economy. GDP stands for Gross Domestic Product. It represents the country's total economic worth and overall wealth. It is in addition to Consumption, Investment, Spending, and Net exports.

Eliminates Poverty and Inflation

Remittance eliminates poverty and inflation in society. The countries that receive remittance spend the money on their surroundings to buy services. For some families, remittance is an additional source of income. So, families either save this money in banks or invest it to earn more profit. Remittance improves living standards and reduces economic complexities.

Open Ways for Investment

Expats often make online investments in different countries to increase their assets. They also invest in Gambian industries and companies so their loved ones can enjoy the profits. Investing or buying shares in any industry supports its progress. With the company's progress, employees' wages also improve, and people become financially stable. Investment plays a vital role in the progress of a country.

Promotes Overall Social Development

Remittance only sent from legal and formal sources promotes social development. Social development means uplifting social services and needs like education, medicine, and technology. The taxes utilized by banks are added to the government assets, which are then used in different projects for the betterment of people. Due to remittance, technology is rapidly advancing in Gambia. Expats can easily send money online to Gambia. Numerous remittance services in Gambia use advanced technology such as ACE Money Transfer.

Supports Financial Sector

Remittance is the most extensive support for Gambia's financial sector, other than GDP. It is a source of foreign currency for Gambia as it increases foreign reserves, which is essential for stabilizing Gambia's currency value. Remittance also leads to the development of financial institutes like banks as they stay active due to income flow. Moreover, remittance encourages families to create bank accounts or connect with remittance services to keep their deposits and transactions smooth.

Empowers Economic Sector

Remittance growth is continuously contributing to the empowerment of Gambia's economic sector. People who receive remittance use it to access essential services and to fulfill their needs. Moreover, it allows people to get a better education and afford medical expenses. In Gambia, the job market is declining, so remittance encourages people to think of ways to make more income by starting small-scale businesses and improving the Ghanaian economic corridor.

Boost Country’s Currency

As the Gambia receives large amounts of foreign money, its currency is improving compared to previous times. Gambians deal with Dalsi. Gambia's currency has remained stable over some time but is still improving. When Gambian people send money online from abroad in pounds, dollars, and euros, Gambian banks convert them to local currency. The actual foreign currency goes to foreign reserves, which helps stabilize the worth of the currency. Stabilizing of currency attracts foreign countries to invest in Gambia, which further leads to Gambia's development.
 

Factors Empowering Remittances to Gambia

Gambians living overseas play a considerable role in promoting the growth of Gambia. The following are the essential points that empower remittances to the Gambia:

Affordable Remittance Service

Low-cost and safe remittance services empower remittances. They encourage expats to make global money transfers. Moreover, they increase financial inclusion, making it easier for people to send and receive money. Some banks or services may charge receivers for withdrawing money, but that becomes a major challenge to remittance. ACE Money Transfer is one of the affordable remittance services that entertain the needs of Gambians with extremely low service charges.

Digital Ways of Transaction

Having digital and advanced methods of financial management makes remittance easier. Digital platforms make money transfers more accessible for people regardless of their location. Digital services reduce the need to visit physical institutes and make remittance convenient for senders and receivers. Digital transactions are fast, secure, affordable, and highly accessible.

Formal and Legal Remittance Services

Formal and legal remittance services can help the Gambia’s economy progress rapidly. Money transfers to the Gambia using banks or legalized remittance services ensure remittance security. They strengthen the government's financial structure, help keep a record of foreign money, increase foreign currency, and boost the economy by activating banks and other financial institutions.
 

Gambia is continuously striving for progress. Many Gambians have moved to different countries worldwide to improve their living conditions. These people send remittances to their families in Gambia to resolve their financial issues. Each money transfer to Gambia has a significant positive impact on its growth. It helps remove poverty by increasing their household income. It supports overall economic empowerment by channeling ways of investment. It keeps the bank functional, and banks are the significant assets of the government that help people tackle their financial problems by granting them loans. Affordable remittance services, digital ways, and formal transactions empower Gambia's remittance.

Role of Remittance in Gambia’s Growth

Remittance plays a vital role in a country’s growth. Countries like Gambia depend on remittance for their economic development. Remittance not only facilitates families or members but also helps Gambia make progress in different socio-economic sectors. It is a significant way of investing and facilitating business and industrial growth. It has made powerful changes in Gambia's medical and educational sectors as remittance-receiving countries spend most of their money on their well-being and academic progress. One of the significant impacts of remittance is the stabilizing of Gambia’s currency.
 

Expats who live abroad make online money transfer to Gambia to pay the bills and taxes of their houses in Gambia. These payments increase the government's treasures and are then used for the well-being of the people. Remittance keeps the financial sectors flowing. It keeps the money circulating in banks, remittance services, and personal accounts of remittance-receiving countries. Reliable and affordable remittance services positively impact Gambia's growth. Moreover, digital solutions and formal money transfer services support the Gambia’s economy. Expats must use legal remittance services to ensure the security of their money.

FAQs

How is remittance essential for Gambia's growth?

Remittance is a significant source of foreign currency and boosts Gambia's financial sectors. It drives economic activities, increases household income, removes poverty, supports small businesses, and empowers firms and industries.

How to increase remittance flow in Gambia?

Remittance flow can be increased by providing expats with digital, affordable, and secure ways to send money to Gambia. Payout locations must also be available. Moreover, Gambia can achieve more economic growth by using formal and legal remittance services. 

What are digital money transfer ways in Gambia?

Digital banks of Gambia and digital remittance services like ACE Money Transfer are safe digital money transfer methods in Gambia. ACE helps Gambian expats overseas to send money to Gambia at a meager cost.

Can you send money to Gambia from abroad within a few minutes?

Transaction time depends upon the service you use. Digital remittance services allow you to send money to the Gambia in a few minutes. ACE Money Transfer facilitates the fastest transaction to the Gambia.

What are the benefits of remittance?

Remittance increases household income, removes poverty, promotes economic stability, boosts financial inclusion, supports small businesses, and increases foreign exchange reserves.
 

Reference Links:

https://migrantmoney.uncdf.org/resources/insights/a-case-study-of-ping-money-in-the-gambia/


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