The Reserve Bank of India released the results of its India’s inward remittances Survey 2016-17, the fourth in the series. It captures various aspects relating to remittances – source; destination; purpose of inward remittances; size; prevalent mode of transmission; and receivers’/ senders’ cost of remittances. Responses were received from 42 major authorised dealers (ADs), accounting for 98.3 per cent of total remittances in 2016-17.
Highlights of Inward Remittances Survey 2016-17
- Remittances to India were mostly routed through private sector banks (74.2 per cent), followed by public sector banks (17.3 per cent) and foreign banks (8.5 per cent).
- 82 per cent of the total remittances received by India originated from eight countries, viz., the United Arab Emirates, the United States, Saudi Arabia, Qatar, Kuwait, Oman, the United Kingdom and Malaysia
- Kerala, Maharashtra, Karnataka and Tamil Nadu together received 58.7 per cent of total remittances.
- The rupee drawing arrangement (RDA) is the most popular channel of remittances which accounts for 75.2 per cent of remittances, followed by SWIFT (19.5 per cent), direct transfers (3.4 per cent) and cheques and drafts (1.9 per cent).
- Size-wise analysis shows that 70.3 per cent of all reported transactions were of more than US$ 500 and only 2.7 per cent were of less than US$ 200.
- More than half of remittances received by Indian residents were used for family maintenance, i.e., consumption (59.2 per cent), followed by deposits in banks (20 per cent) and investments in landed property and shares (8.3 per cent).
- Cost to the remitter for sending remittances through RDA is relatively low in the case of private /foreign banks.
- The cost of receiving remittances through the RDA route is lowest in the case of public sector banks.
- MTOs operate mostly in the cash-to-cash services segment which accounts for 96.8 per cent of the total remittances routed through them.
- The cost of sending remittances through MTOs using the cash mode varies between 0.6 to 11.1 per cent, depending upon the size of remittances.
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References
https://rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=44722