A remittance is funds that are sent or transferred to another party usually abroad. Remittances can be sent to another country via a wire transfer, mail, draft, or check. Remittances can be used for any type of payment such as an invoice, but it’s typically used to pay family members back in a person’s home country. Remittances have played an increasingly large role in the economies of small and developing countries. Since the late 1990s, remittances have exceeded development aid, and in some cases make up a significant portion of a country’s gross domestic product (GDP). According to a report by The World Bank in 2018, $466 billion in remittances were sent to low-income and middle-income countries in 2017. If we include high-income countries as well, the total amount of remittances jumps to $613 billion. For low-income countries or countries where their economy is struggling to develop, remittances represent one of the largest sources of income for their people.

Inward Remittances

The inward remittances refer to the case where the money is sent from the foreign countries by the migrant workers to their friends, families and relatives in India. For sending the inward remittances, the most popular ways are via bank channels, wire transfer, foreign currency cheques as well as rupees cheques. The foreign currency cheques are issued that can be used for collecting the money by depositing it in a branch of bank in India. The rupee cheques are issued in the Gulf countries for sending money back home. There are many migrant workers that are using the services of online money transfer as offered by banks. Nowadays, banks provide a shorter turnaround time within 24 hours for sending money to India. This proves to be a major benefit of wire transfer as compare to other methods.

Outward Remittances

The outward remittances refer to the process of sending money in foreign locations from the home country to your family members, friends or relatives. This procedure is governed by lots of regulations. The outward remittances in India are done mainly through banks. If you like to do the outward remittance, you should ensure that you are dealing with the genuine people and firms because you cannot trust any individual or a financial firm for sending your money. You need to select a bank that has international footprint and good reputation for making your job almost effortless.