Remittance in Nepal
Concept of Remittance
The remittance is related with the foreign currency. In order to facilitate the transfer of funds between countries, banking companies provide this service. As Nepalese youth travel to foreign countries in search of jobs, the remittance services provided by banks provide a safe and legal way for them to send their earnings home. Banks are also transferring funds from Nepal to other countries as part of this business. Inward remittances and Outward remittances are two sides of the business; the inward remittance means receiving funds from abroad and the outward remittance means sending money abroad. Banks use different methods for these types of fund transfers.
Remittances are money transfers by foreign workers to their home countries. Migrants’ money is the largest source of international aid to developing countries, competing with international aid. International capital flows are heavily influenced by workers’ remittances, especially in labour-exporting countries. Developing countries received $436 billion in 2014, a record amount. There were also $583 billion in global remittances.
Types of Remittance
There are four types of remittances:
- Family Remittances,
- Community Remittances,
- Migrant Worker Remittances, and
- Social Worker Remittances.
1) Family Remittances
Immigrants sending remittances to their families, relatives or friends back home are said to be sending remittances. Every month, these remittances are sent to the migrants’ families and help them survive. As a result of these remittances, poor families are also able to fight against poverty. Family remittances are considered to be the most common form of remittances around the world where millions of workers work hard in distant lands to earn their living.
2) Community Remittances
Individual immigrants send remittances, and also hometown associations send remittances to communities and organizations in their home country. Communities have used this money to build infrastructure, churches, parks, and roads as part of their development activities. Poor people can also access health care through it. Health benefits, education, and employment are also offered through community remittances to communities in their home countries who need these services.
3) Migrant Worker Remittances
Migrant workers send money back home through remittances, which refers to cash transfers to family, friends, and relatives. Many people who migrate to foreign countries for money, employment, or education send money back to their home countries through migrant worker remittances.
4) Social Remittances
Many remittances that flow from workers from one country to another are based on various ideas, practices, and social capital. Social remittances make it possible for one race or community to socialize with the cultures and traditions of another. People bond through social remittances, which don’t involve money.