After a period of strong growth during 2021-2022, officially recorded remittance flows to low- and middle-income countries moderated in 2023, reaching an estimated $656bn, according to the World Bank’s latest Migration and Development Brief.

The modest 0.7% growth rate habours large variances in regional growth, but remittances remained a crucial source of external finance for developing countries in 2023, bolstering the current accounts of several countries grappling with food insecurity and debt issues. In 2023, remittances surpassed foreign direct investment and official development assistance.

Remittance flows increased most to Latin America and the Caribbean, by 7.7% to reach $156bn; South Asia saw a 5.2% increase, reaching $186bn; and East Asia and Pacific (excluding China) witnessed a 4.8% rise, reaching $85bn. Sub-Saharan Africa saw a slight decline of 0.3%, falling to $54bn, while the Middle East and North Africa experienced a nearly 15% drop to $55bn, and Europe and Central Asia saw a 10.3% fall to $71bn.

According to the report, sending remittances remains too costly. In the fourth quarter of 2023, the global average cost of sending $200 was 6.4% of the amount being sent, slightly up from 6.2% a year earlier and well above the SDG target of 3%. Digital remittances had a lower cost of 5%, compared with 7% for non-digital methods, highlighting the benefits of technological advancements in reducing the financial burden on migrants.