Personal remittances hit all-time high of US$34.9 billion in 2021

Full-year 2021 personal remittances from Overseas Filipinos (OFs) reached a new high of US$34.884 billion, surpassing US$33.467 in 2019, and the US$33.194 billion recorded in 2020 by 5.1 percent.

For the month of December, personal remittances grew year-on-year by 2.9 percent to US$3.298 billion, the highest monthly level since the tracking of personal remittances data series began in 2005.

The sustained growth in personal remittances during the year was driven by remittances sent by:

1) land-based workers with work contracts of one year or more, which increased annually by 5.6 percent to US$27.005 billion from US$25.564 billion, and

2) sea- and land-based workers with work contracts of less than one year, which grew by 2.9 percent to US$7.138 billion from US$6.934 billion in 2020.

The growth in personal remittances reflected a pickup in OFW deployment, strong demand for OFWs amid the reopening of host economies to foreign workers, and the continued shift to digital support that facilitated inward transfer of remittances.

The strong inward remittances, in turn, contributed to the increase in domestic demand, with the 2021 level accounting for 8.9 percent and 8.5 percent of the country’s gross domestic product (GDP) and gross national income (GNI), respectively.

Of the personal remittances from OFs, cash remittances coursed through banks grew by 3.3 percent to US$2.987 billion in December 2021 from US$2.89 billion in the same month of 2020.

This resulted in full-year 2021 cash remittances totaling US$31.418 billion, up 5.1 percent from the US$29.903 billion recorded in 2020.

The growth in the 2021 cash remittances was supported by the increase in receipts from land-based and sea-based workers, which rose by 5.6 percent (to US$24.873 billion from US$23.55 billion) and 3.0 percent (to US$6.545 billion from US$6.354 billion), respectively.

Notwithstanding the global pandemic, cash remittances sent by OFs across various regions remained robust.

This was evident in the growth in annual inward remittances from the Americas (7.1 percent), Europe (5.5 percent), Asia (4.5 percent), and the Middle East (0.7 percent).

By country source, cash remittances from the United States accounted for the largest share of overall remittances at 40.5 percent followed by Singapore, Saudi Arabia, Japan, the United Kingdom, the United Arab Emirates, Canada, Taiwan, Qatar, and South Korea.^[1]

The combined remittances from these top ten countries represented 78.9 percent of total cash remittances in 2021.

^[1] There are some limitations on the remittance data by source. A common practice of remittance centers in various cities abroad is to course remittances through correspondent banks, most of which are located in the U.S. Also, remittances coursed through money couriers cannot be disaggregated by actual country source and are lodged under the country where the main offices are located, which, in many cases, is in the U.S. Therefore, the U.S. would appear to be the main source of OF remittances because banks attribute the origin of funds to the most immediate source. The countries are listed in order of their share of cash remittances, i.e., from highest to lowest.