Remitting through crisis: learning lessons from the pandemic

Given the importance of migrants’ remittances in many parts of the world, recent global challenges raise the question: what happens when people are squeezed at both ends? As the world confronts ongoing climate, conflict and cost-of-living problems, what can we learn from the pandemic period about people’s remittance practices through times of crisis?

A lot of emphasis is placed on the analysis of official remittance data and the importance of migrants’ remittances in countries of origin, and the resilience of these flows through crises. Less attention has been given to the experiences and practices of the migrant communities sending these funds.

Connecting During Covid

Our collaborative UKRI-funded research project Connecting During Covid, with QMUL and UCL, used an online survey and qualitative interviews to explore the pandemic experiences and remittance practices of three groups with distinctive histories of migration to the UK – the Brazilian, Indian and Somali diasporas (the survey was not representative but captured a cross-section of people from each community). More info can be found in our recently published briefing paper.

Transfers to the family for their use dominated over other financial transfers, for example, for savings and investments or charitable and community purposes. Around half the survey respondents perceived that the needs of family and friends abroad increased in 2020. People who were already remitting money regularly felt more acutely people’s reliance on their support, particularly elderly parents. Economic upheavals abroad also meant that people were being contacted by new people in need and were supporting more basic needs than previously.

The pressure of income reduction during the pandemic

Between 2019 and 2020, the likelihood of our survey participants remitting increased. However, the average remittance transfers by participants decreased. On the one hand, the UK did not see the mass returns some feared might be prompted by the pandemic. Some people were key workers or had relatively secure jobs. Others benefitted from the pandemic furlough or self-employment income support scheme, which they contrasted with the more limited government support for relatives affected by the pandemic in Brazil and India and the lack of a public safety net in Somalia. But on the other hand, around half the survey respondents experienced reductions in both individual work earnings and overall household income. A third struggled to cover essential costs such as food, energy and housing. Many people were obliged to be creative and work very hard with second jobs and side hustles. Some people resorted to using savings or borrowing to help out their families. Even so, although those struggling sent less on average, it was not just the better-off remitting: similar levels of income reduction and struggles with essentials costs were reported among senders and non-senders.

When well-being is discussed in relation to remittances, the focus tends to be on improvements in the well-being of recipients rather than senders. But many people clearly derive a real sense of meaning and connection from being able to send money: a sense of paying back or paying forwards and a strengthening of family feeling. This was accentuated by the restrictions on physical visits and concerning reports of the unfolding situation in countries of origin. At the same time, some people also experienced significant stress around remitting – whether because they were struggling to send or feeling shame that they could not. A Somali community organisation noted that the interruption of people’s ability to send money to Somalia was ‘a very big feature in the anxiety landscape’, amongst all the other challenges Somalis in the UK were facing during the first UK lockdown. Pressure to send varied by community, being most salient among Somali survey respondents, reinforcing the idea that disparities in income and security between countries are an important driver of remittances. Family communication around these issues was complex. Some UK residents hid their pandemic difficulties to avoid troubling family members abroad; some found it challenging to explain their difficulties to family members they felt had a romanticised image of life in the UK. All this points to the importance of factoring migrants’ well-being into discussions of remittance flows.

Responding to escalating financial needs

In sum, it is clear that UK residents did respond to escalating needs abroad through their remittances. But capacities to remit were undermined by economic challenges in the UK, with many struggling to send money. As families, communities and countries around the world grapple with multiple contemporary challenges, these points are pertinent to any policy interventions targeting remittances.

First, supporting migrants’ livelihoods and rights is vital to maintaining remittances. As with the pandemic, the rising cost of living is hitting the capacities of UK residents to support family abroad while simultaneously increasing those family members’ needs, squeezing people at both ends. While the policy emphasis has been on keeping remittances flowing, more attention needs to be paid to what underpins remittances. Also, the predominantly domestic, inward-looking nature of the conversation about cost-of-living in the UK would benefit from being broadened to consider how it connects, through migration, to wider transnational dynamics.

Second, efforts to leverage diaspora contributions for development in origin communities need to take account of diaspora concerns and issues. While remittances can contribute to livelihoods and well-being in significant ways, there are a range of challenges in major countries of emigration that act as key drivers of migration, and cannot be ‘fixed’ by diaspora money. These transfers are embedded in close human relationships and wider global structural inequalities. Successful remittance initiatives will pay close attention not only to the need for and deployment of cash, but also to the motivation, capacities and welfare of those providing it.

This blog was published in collaboration with SOAS DevTraC, as part of DevTraC’s aims to promote spaces for ‘critical conversations’ between researchers, policy makers and practitioners and activists and to facilitate research and knowledge exchange within the international development arena.