Expats in the UAE remitted $ 10.6 billion during 2010: Data

Expats in the UAE remitted $ 10.6 billion during 2010: Data

According to the Central Bank of UAE's annual report, employees' transfers abroad (remittances) increased from USD 9.5 billion (35 billion dirhams) in 2009 to USD 10.5 billion (38.8 billion dirhams) in 2010, an increase of 10.8 per cent.

According to a news report quoting UAE Central Bank figures, one reason for the growth in outward remittances during a year that saw continued uncertainty amid job losses and no noteworthy salary hikes for employees in the country could be the slide of the US dollar, to which the dirham is pegged.

A decline in the dollar against one's target currency means that one would have to send more dirhams to remit the same amount of home currency.

While the US dollar fell 7.2 per cent against the New Zealand dollar, a massive 14.7 per cent against the Japanese yen and 14.1 per cent against the Aussie dollar during 2010, it also fell a more modest 4.3 per cent against the Indian rupee and 6 per cent against the Philippines peso, arguably the two biggest receivers of UAE remittances, the Emirates 24/7 report said.

India is the largest recipient of remittances in the world, receiving USD 49 billion annually and USD 6.2 billion, or 12 per cent of that amount, comes from the UAE, a Standard Chartered Bank report said last month.

The flow of funds from the UAE to India is one of the most important corridors of funds flowing into India.

According to a MasterCard report, the booming global remittances market provides banks with an opportunity to capitalise on their strengths in global payments and harness new banking products and technology.

"By leveraging internet service and distribution capabilities, the low-cost infrastructure afforded by reloadable prepaid cards and mobile technologies, as well as their access to superior foreign exchange rates, banks can gain share," it added.

"In the UAE-India corridor, two major types of remittance providers compete with banks for consumers' business: MTOs or exchange houses and hawala. While banks in India receive fully 75 per cent of remittances, on the UAE sender side, MTOs are the dominant provider. Blue-collar workers, who make up between 65 and 70 per cent of Indians in the UAE, mainly remit from MTOs to bank accounts in India," the report said.