If you asked any financial expert about the importance of money transfer to Brazil as recently as a few years ago, the chances are that it was the last thing on their mind. However, the level of migrant workers has dramatically increased in locations like Japan, Germany, and the United States.
Over 1.9 Brazilians live abroad and send money to Brazil on a regular basis. The nation is the second largest recipient in Latin and South America. In 2007, formal remittance to Brazil was estimated at $ 2.8 billion, while Inter-American estimated $ 5.8 billion total in remittance through formal and informal corridors.
Unfortunately, the ability to track the remittance corridors has been largely inaccurate until now. The high finance charges of banking institutions made informal corridors a more popular method. Sadly, mail courier services have proven to be highly unreliable due to the amount of time it takes to deliver and the crime associated with it.
The recent introduction of ATM remittance cards have helped to track the informal corridors. For families living in poverty, it’s common to receive smaller amounts ranging from $ 400-$ 600 on a regular basis. The ATM money transfer helps solve the problem of high transfer fees. In the meantime, the levels of poverty have decreased, and financial experts are better able to study where this money goes.
Brazil reports 31% of the population below the poverty line and ranks number 11 in the world according to nationmaster.com in 2005. Over 50% of remittance recipients use the money to meet daily living expenditures such as food and shelter. However, a growing number of recipients report to having a college education, making investments, and building their credit.
Money transfer to Brazil is one of the hugest factors in the reduction of poverty in Brazil. The reduction of transaction fees further alleviates the poverty levels in Brazil. When remittance levels become sluggish, poverty levels notice a direct impact. Some analysts suggest that remittances increase with the ease to transfer money due to an increasing level of migration.
Economists mostly analyze the role of remittance, but the information remains scant until better transfer methods are utilized on a regular basis. As remittance gains competition with instant Internet money transfers, the fees are reduced and informal corridors become obsolete.
The study of money transfer to Brazil crosses over to several disciplines including economy, politics, and social moral. These next few years need to be crucially studied in order to understand how remittance can strengthen the economy and level out the playing field. To truly understand the impact of remittance on Brazil, more attention needs to be given to the informal corridors of remittance.
As more families make money transfers to Brazil, the poverty levels decrease. In the past, Brazil’s differences between the rich and poor had a large gap. The repression of those living in poverty is much more than financial. It’s a symbol of repressed races, cultures, and genders investing money in their homeland to narrow the gap of poverty and upper class.
By 3dman_eu from Pixabay