Diaspora remittances are a critical source of liquidity in the economy with more families relying on the revenue stream for support from their loved ones who work outside the country.
Presenting the 2019 Monetary Policy Statement on Wednesday, RBZ Governor Dr John Mangudya said the drop in diaspora remittances was a result of several factors.
"Diaspora remittances contributed $619,2 million, a decline of 11,4 percent as compared to $699 million received in 2017. The decline of diaspora remittances is mainly attributed to the preference to send in-kind remittances by the diaspora and the interception of remittances in South Africa by cross border traders," he said.
The send in-kind remittances are largely informal and cannot be officially recorded.
Some have complained over inefficiencies in getting their monies from banks and transfer agencies. Others generally shun informal channels.
Dr Mangudya said South Africa contributes about 34 percent of the total diaspora remittances which get into the country. He also said international remittances declined by 19 percent from $1.4 billion received in 2017 to $1.1 billion received in 2018.
As part of measures to incentivise channelling of remittances through formal channels, the RBZ in 2017 devised an incentive package of up to 10 percent for domestic recipients.
This was in addition to the Diaspora Remittances Incentive Scheme (DRIS) introduced in 2016 that benefited both the money transfer agents and the receiver of the funds on the basis of a two percent and three percent split to reduce the cost of receiving and sending remittances.
Recently, recipients of diaspora remittances in Bulawayo have been struggling to access their money as banks and transfer agencies are said to have a limited supply of foreign currency.
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