My results indicate that an increase of one percent in the flow of remittances reduce the measure of poverty gap and severity by 5.7 and 5.2%, respectively. I also find that an increase of one percent in remittances increases inequality by 1.9 percent in Mexican rural areas.

Most of Mexico’s remittances are sent by the millions of Mexicans living in the United States and are a pillar of support for Latin America’s second-largest economy, which suffered its steepest contraction in 2020 since the Great Depression of the 1930s. Remittances sent to Mexico totaled $40.61 billion last year.

The amount of remittances has contributed to increase the foreign exchange received by the Mexican economy, and its magnitude can be compared with inflows of foreign direct investment. However, on average during the period, the rate of growth of economic activity at the state level exhibited a positive growth.

Remittances can reduce labor supply and create a culture of dependency that inhibits economic growth. Remittances can increase the consumption of nontradable goods, raise their prices, appreciate the real exchange rate, and decrease exports, thus damaging the receiving country’s competitiveness in world markets.

Remittances help to increase the standard of living of the families that receive them. This positively affects them by increasing their day to day available spending money. It can also help increase consumption of these families as a kind of financial injection as a result, increasing national income and affecting GDP.

Remittances Support Economic Growth The economic effect of remittances increases the recipient’s household income and the foreign exchange reserves of the recipient’s country. Remittances contribute to output growth if invested, and generate a positive multiplier effect if they are consumed.

While remittances are an important lifeline in many developing countries, they can also foster a dependency on outside flows of capital instead of prompting developing countries to create sustainable, local economies. Remittance flows can be negatively impacted by a downturn in the global economy.

India

Since the income of migrants has, in principle, already been taxed in the host country, taxing remittances amounts to double taxation for tax-paying migrants. Since remittances are usually sent to poor families of migrants, the tax would be born ultimately by them and therefore it is likely to be highly regressive.

The Reserve Bank of India (RBI) on Friday raised the limit on the number of foreign remittances an individual can receive from 12 to 30 per calendar year. However, the cap on the amount of each transaction has been kept unchanged at $2,500 per person.

Some popular options for remittances are:

1. Banks.
2. Credit unions.
3. Money transfer operators like Western Union, MoneyGram, WorldRemit, etc.
4. Peer-to-peer transfer providers such as Transferwise, CurrencyFair, Paypal, etc.
5. Currency exchange businesses.

Canada has no gift tax, so you can give your children as much money as you like, it is not taxable as income or deductible as an expense. Helping your children is a great way to reduce your estate while you are still here.

How to Transfer Money from One Bank to Another

1. Go to your bank’s website to link accounts.
2. Proof of account ownership.
3. Provide the necessary information.
4. Very the account.
5. Verify the deposits.
6. Start transferring money from one bank to another.
7. Apps.
8. Writing a Check.

For example, if you have a checking account, savings account and a money market account at the same bank that are all owned by you and you alone, the combined balances for those accounts would be insured up to the “per depositor” $250,000 limit.