Migrants' Choice of Remittance Channel: Do General Payment Habits Play a Role?
37 Pages Posted: 6 Apr 2013
There are 2 versions of this paper
Migrants' Choice of Remittance Channel: Do General Payment Habits Play a Role?
Migrants' Choice of Remittance Channel: Do General Payment Habits Play a Role?
Date Written: April 4, 2013
Abstract
This paper investigates the determinants in migrants’ choice of payment channel when transferring money to relatives abroad. We surveyed 1,680 migrants in the Netherlands, identifying five remittance channels: bank services, money transfer operator (MTO) services, in-cash transfers via informal intermediaries, ATM cash withdrawals abroad and carrying cash when travelling back home. To the best of our knowledge, we are the first to present evidence of the role played by general payment habits: migrants who regularly use internet banking for other purposes are more likely to use bank services for remittances as well. However, we also demonstrate that other important drivers exist in determining the choice of payment channels, such as personal characteristics and country-specific factors, (perceived) costs, ease of use and the availability of remittance options. Based on our findings, we suggest that financial education, cost reduction and new (mobile) remittance solutions may serve a valuable role.
Keywords: Remittances, payment instruments, qualitative choice models
JEL Classification: F24, E42, C25
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Income Maximization and the Selection and Sorting of International Migrants
By Jeffrey Grogger and Gordon H. Hanson
-
Migrant Networks and Foreign Direct Investment
By Beata Smarzynska Javorcik, Caglar Ozden, ...
-
Immigrant Selection in the OECD
By Michèle Belot and Timothy J. Hatton