StatsCan reports foreign-born residents sent $5.2 billion home in 2017

Canadian residents sent more than $5 billion to relatives abroad in 2017, according to a new study of international money transfers from Statistics Canada.

The study, released on Wednesday, found that 37% of people who were born in developing countries but are now living in Canada sent a combined $5.2 billion back home in 2017. Those remittances averaged $2,855.

These transfers generally face high transaction costs, with the average transfer fee eating up 6% of the amount being sent. StatsCan noted that, under the United Nations’ Sustainable Development Goals (SDGs), developed countries have committed to reduce these costs to less than 3%.

Over half (56%) of residents who send money home use money transfer stores. Ten percent delivered money in person, 9% used in-person banking and 5% opted for online banking to send money, StatsCan reported.

The top destination for these transfers was the Philippines, accounting for $1.2 billion, followed by India ($794 million), China ($292 million) and Pakistan ($236 million).

Additionally, $390 million was sent to the U.S., the study noted. Indeed, StatsCan found that 15% of these transfers ($761 million) went to developed countries.

The study also found that most of these transfers (59%) were intended to pay basic living expenses (food, housing and utilities). The other top uses are for medical expenses, or gifts.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.