JEDDAH – Saudi Arabia is one of the world's most economical places for remitting money to other countries, World Bank data showed. The global average remittance costs are 8.96 percent, the report noted. According to Remittance Prices Worldwide data, the global average total cost of remitting $200 worldwide was 8.96 percent in September 2012. The entire Gulf region is highlighted as the best globally, despite costs rising last year, it added. “Whilst the costs in these markets can vary from month to month, their competitiveness in comparison to other sending markets in the sample reflects the fact that the Gulf region is amongst the cheapest for remittances globally thanks to the high level of competition achieved in these markets,” a World Bank statement said. South Asia is the cheapest region to send money to, with an average of 6.54 percent. The world's most economical country for remitting money to India is Singapore (4.16 percent), followed by the US (4.35 percent). While it takes less than the global average to remit $200 from the UAE to India (5.02 percent), the most economical Gulf country to remit money to India is actually Saudi Arabia, from where it takes 4.40 percent of the total transaction cost to remit $200 to India. Saudi Arabia's cheapest destination countries to send $200 are Pakistan (2.82 percent), Yemen (2.96 percent), Nepal (4.32 percent), Jordan (4.37 percent), India (4.4 percent), Egypt (4.62 percent) and the Philippines (5.34 percent). The World Bank said sending remittances from the UAE to Pakistan (an average 4.92 percent of the money transferred) is the cheapest corridor in the world, while the UAE to Sri Lanka (6.35 percent) is the fifth cheapest. Saudi Arabia to Pakistan (5.63 percent) and Yemen (5.92 percent) are the third and fourth least expensive corridors, considering the transaction fee and exchange rate margin. The UAE is the world's cheapest country for remitting money from, the report said. With an estimated expat population of up to 80 percent in the country, remittances from the UAE form a big chunk of an expats' monthly financial dealing. To send $200 from the UAE to India – where a significant chunk of the nation's earnings are sent – costs an average 5.02 percent, while it can be as cheap as 2-3 percent depending on the bank used. It will cost an average 5.63 percent to send $200 in remittances to Nepal, 3.18 percent to Sri Lanka, 3.23 percent to the Philippines, 4.06 percent to Egypt, 2.46 percent to Pakistan. Charges will differ according to the amount sent. For example, the cost falls to 2.81 percent to send $500 to India. The world's least expensive corridor for remitting $200 is the UAE to Pakistan corridor, where it costs $4.92 to remit $200 (2.46 per cent), followed by Singapore to the Philippines ($5.42), Saudi Arabia to Pakistan ($5.63), Saudi Arabia to Yemen ($5.92) and the UAE to Sri Lanka ($6.35). However, for higher denominations ($500), the corridors change but only slightly. Meanwhile, the most expensive corridor in the world for a $200 remittance is the South Africa to Zambia remittance, where it costs a whopping $45.87 to remit $200 (almost 23 per cent), followed by Ghana to Nigeria ($44.56), South Africa to Malawi ($43.17), South Africa to Botswana ($42.24) and Tanzania to Rwanda ($42.14), the World Bank data further showed. With an average total cost of 11.89 percent, sending $200 to (or within) Africa is 2.93 percentage points higher than the global average. Sending money to Africa is over 5 percentage points more expensive than sending the same amount to South Asia, which costs 6.54 per cent, the lowest in the world, a recent World Bank report noted. The world's least expensive corridor for remitting $500 is Saudi Arabia to Yemen, where it costs $6.82 to remit $500 (1.36 per cent), followed by Singapore to the Philippines ($7.12), the UAE to Philippines ($8.56), the UAE to Pakistan ($8.7) and the UAE to Sri Lanka ($9.31). “The two cheapest sending markets in the survey are the Gulf countries of UAE and Saudi Arabia which, in Q4 2012, measured at 3.5 per cent and 4.7 percent, respectively,” the report said. The World Bank is aiming to bring down the cost of sending remittances to an average 5 percent by 2014. The director of the World Bank's Africa Region and Financial Inclusion and Infrastructure Global Practice, Gaiv Tata, said “remittances play a critical role in helping households address immediate needs and also invest in the future, so bringing down remittance prices will have a significant impact on poverty.” – SG
