from MARIA MACHARIA in Nairobi, Kenya
NAIROBI, (CAJ News) – REMITTANCES to Kenya from the Diaspora have defied the odds presented by the coronavirus (COVID-19).
The increase comes despite the impact of the pandemic on wages and employment across the world.
The Central Bank of Kenya (CBK) recently released data showing that remittance flows to the country increased by 10 percent, from US$2,796 million in 2019 to US$3,095 million in 2020, accounting for three per cent of the country’s Gross Domestic Product (GDP).
This is contrary to projections made in 2020 that predicted that remittances in low and middle income countries were likely to decrease as a result of the pandemic.
The increase in remittance flows to Kenya has been attributed to financial innovations that have opened up more convenient channels, such as using mobile phones for transactions, which make it easy for families to send and receive money despite the wide spread restriction of movement and lockdowns.
“The rapid acceleration of digitalization has been the ‘silver lining narrative’ of the pandemic,” said Patrick Njoroge, Governor of CBK.
“Remittances have been one of the key beneficiaries of digital transformation as members of the diaspora sent funds to their loved ones back home to help them ride out the ravages of the pandemic,” he added.
A recent study on Kenya released by the International Fund for Agricultural Development (IFAD) highlighted innovative solutions that had the potential to increase access and use of the remittances for greater financial inclusion and investment opportunities.
“What the remittance market needs now is good practices and innovations that offer digital solutions and financial services to the families who receive remittances to enhance their recovery and resilience,” said Pedro De Vasconcelos, Manager of IFAD’s Financing Facility for Remittances.
– CAJ News