re-examining remittances

7/30/2019 Re-Examining Remittances

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Re-ExaminingRemittances

by

StudentsintheSpring2013SimonFraserUniversitycourseSA356:QualitativeandEthnographicResearchMethods*

Meena Boyal, Lawrence Lau, Kaity Walters Fabbro, Phil Lui, Amanda J. Schubert, Ruby

Stewart, Rae-Anna Hedlin, Stephania Domingo Rajme, Katherine Dare, Jenn Whittle,MarissaBourke,MarelaKlepo,ZiwenLi,PaulShemko,RolandoAldana,JaneWhittington,RachelFricker*Theorderofauthornameswasdeterminedbyrandomselection.


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Note to Readers:

The document that follows was produced by undergraduate Sociology and Anthropology majorsat Simon Fraser University. They conducted the research, analysis and writing as part of their

coursework for SA356 - Ethnographic and Qualitative Research Methods during the 2013 Spring

semester.

The research reported here is intended to inform the Remittance Justice campaign of ACORN

Canada, but was designed and carried out completely independent of ACORN Canada and its

staff. The research was approved by the Office of Research Ethics at Simon Fraser University

and was conducted in conformance with the ethical protocols established for the project. Dr.

Pamela Stern of the Department of Sociology and Anthropology at SFU taught the class and

supervised the research. Questions about the research project or this report should be directed toher [email protected]


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ExecutiveSummary

Thisreportdescribessomeoftheculturalandeconomicfactorsinvolvedinthepaymentof

remittancesbyimmigrantsinMetroVancouver.WithincreasingimmigrationtotheMetro

Vancouverarea,particularlybytemporaryforeignworkers,remittancesarebothculturally

and economically significant and represent important ties between nations and within

transnational families. The fees charged for international money transfers are currently

unregulated in Canada,andoften representa substantial costto senders andrecipients.

TheWorldBanksuggeststhatthecostofsendingmoney(includingfeesandexchangerate

premiums) should not exceed 5% of the money remitted. Many of the immigrants

interviewedforthisstudypaymuchhigherratestosendmoney.

Immigrants send money to their friends and families in their countries of origin for a

varietyofreasons.Theseincludeoccasionalgifts,butmanyimmigrantssendsmallregular

sumsofmoneytoassistrelativeswithordinaryexpenses.Thesupportfromimmigrantsto

their kin is similar to the financial support non-immigrant Canadians give to their own

relatives.Itincludes:

1) Supportforagingparents;2) Moneytocovermedicalbillsorskillednursingcareforsickorelderlyrelatives;3) Loanstokintostartbusinesses,makeinvestments,orpaylegalexpenses;4) Schoolanduniversitytuitionforchildrenandsiblings;and5) Repaymentofearliersupportprovidedtothesender.

Whileallremitterspayfeestosendmoney,theresearchrevealedthatimmigrantswhose

familiesarethemostinneedofsupport,necessarilysendsmallsumsofmoneyfrequently.

Thesearethesenderswhoaremostdisadvantagedbythelackofgovernmentregulation

onremittancefeesandexchangeratepremiums.

Therearealsoanumberofnon-economicfactorsthatinfluencehowasenderchoosesa

service,suchasspeedoftransferandsecurityoffunds.Respondentsshowedconsiderable

desireforCanadiangovernmentstolegislatetoregulateandcapfees.


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TableofContentsNotetoReaders i

ExecutiveSummary ii

Introduction 1ImmigrantsinMetroVancouver 7

RemittanceServicesinMetroVancouver 12

TheCostofSendingRemittances 15OnlineRemittancesthroughWesternUnionandMoneyGram 21Advertisements 22SummaryofRemittanceServices 24

ResearchMethods 25

WhatImmigrantRemittersToldUs 28 Immigrantremittancespracticesparallelnon-immigrant

Canadiannormsoffamilialsupport 33

Suggestionsfromparticipants 36ConclusionandPolicyRecommendations 37ReferencesCited 40


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(DelaPea2008;Martin,2009;Passas,2006).Formalservicesmaybebasedinstitutionally

inthesendingcountryorthereceivingcountry,butinthecaseofinformaltransfers,there

maybeanabsenceofnationallegaljurisdictionoroversight.

Remitterschoosehowtosendmoneyonthebasisoffactorssuchasconvenience,

security,andcost(Beck&MartinezPera,2011;Kabeera,2012;Kwantes,2011).Inspiteof

the economic significance in the lived experiences of many workers and their families,

remittance fees are unregulated in Canada. Although competition between MTOs may

constrainthefeesthatsendersarecharged,feesoftenrepresentasignificantportionofa

remittancepayment,particularlyifthepaymentisrelativelysmall(Beck&MartinezPera,

2011).Aswell,therearelargedifferencesinfeeschargedforsendingmoneytodifferent

partsoftheworld(Hopkins,2012).Culturaltiesandvaluesalsoinfluencetheremittance

process. Particularly in the choice made by some immigrant workers to use informal

serviceslikehawala,remittancesmaybemadeonthebasisoftrustandsharedcultural

understandings(DelaPea,2008;Martin,2009;Pandey,2012;Passas,2006).

Remittances are part of complex webs of social interaction, influencing family

dynamics across generational and geographical boundaries (Sing et. al., 2010; Solheim,

2012)Sending remittancesare amongthe challenges new immigrants face insettlingin

Canadawhilemaintainingtieswithfamilyintheircountryoforigin(McKenzie&Mjenivar,

2011; Solheim, 2012). Because of their magnitude and extent, sending remittances also

contributetotheformationofnewbondsinglobaldiasporas(Keillburger&Keillburger,

2012

Aswell asbeingimportantto immigrants andtheir families, remittances and the

remittanceprocessarealsoimportanttoCanada.Theyareanimportantpartofthereason


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some immigrant workers come to this country and, in many cases, eventually become

permanentresidentsandcitizens.Decisionsabouthowoftenandhowmuchtoremitare

tiedtogovernmentpoliciesandprogrammessurroundinghealthcare,education,andsocial

services(Brettell,2007;Zuberi&Ptashnick,2011).

Theflow of wealthinvolved in remittancesis significant andis one of thelargest

components of wealth transfers to receiving countries. Globally, the total value of

remittancesin2012wasUS$400billion,upfromUS$328billionin2008(Beck&Martinez

Pera, 2011). Remittances have been shown to contribute significantly to economic

development, thereby, overall increasing the social well-being in receiving countries

(Bakker,2011;Brettell,2007;Green,Kothari,Mercer,&Mitlin,2012).Theyallowfamilies

toinvestinsmallbusinessesandagriculture(Haas,2005),andpromoteamorewidespread

accesstoeducation.Thesebenefitshelpfamiliesescapecyclicalpovertyandtheypromote

communityeconomicdevelopment(Haas,2005;Bayangos,2011;Brettell,2007).

InthecaseofthePhilippines,forexample,RiveraandReyes(2011)haveshownthat

remittances can significantly increase recipients socio-economic status and even lead

families to create new small businesses, resulting in permanent economic advancement

and less reliance on remittances. This makes the economic situation easier for both the

senderofremittancesandthereceiver.Similarly,Basok(2000)foundthattheremittances

ofseasonalMexicanimmigrantsworkinginCanadaprovidedtheirfamilieswithahigher

standardofliving.

At a macro-economic scale remittance practices can have significant impacts on

nation-states.Athighlevelstheyaffectinterestandexchangerates,whichareimportant

for investment decisions. Also significant are the effects on the value of the receiving


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countryscurrencyanditsbalanceoftrade(Bayangos,2011).Labourmigrationcanalso

improvetheeconomicsituationofanentirecountry.Thisisnotonlyduetoremittances,

butwhenworkersleave for jobsabroad,they create gaps intheir previousemployment

that are filledwith other workers. When the workers return, the skills acquired abroad

may enable them to acquire better jobs and they are also able to pass on their skills

(Bayangos,2011).Atthesametime,remittancesareadouble-edgedswordforreceiving

countries in terms of their social effects and influence on policy. In comparison to

government foreign aid, which may be sporadic and vulnerable to political influence,

remittancepaymentsarerelativelymorepredictableandlessvulnerabletopoliticalwhims

(Bayangos, 2011). However, remittances largely bypass, and to some extent replace

government social support for families and communities. These effects can create a

dependencyonremittancesforreceivingcountries(Haas,2005).

Remittances,then,representanincreasinglysignificantsetofglobalexchanges.Asa

transferofwealth,theynotonlyaffecttheeconomicsituationoffamiliesandcommunities,

butalsoinfluencethe nationaleconomiesof thecountriestheyinvolve.Theseeconomic

exchangesshapeandaregroundedincomplexsocialandculturalrelationships,withwide-

rangingeffects.Thiswealthtransferistiedtoanemergingsetofglobalfinancialoperations

with a fluid, complex, and largely unregulated impact on the lives of those involved in

sendingandreceivingremittances.

In Canada, there has been an upward trend in the amount and regularity of

remittancessentsincetheyear2000(Unheim&Rowlands,2012,p.124).Thereisethnic

variationinremittancepractices.OnestudyofCanadianimmigrantsfoundthatthosewho

comefromSoutheastAsiaandtheCaribbeantendtobethemostlikelytoremit(Houle&


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Schellenberg, 2008, p.22), although globally, China, India, and Mexico receive the most

money from Canadian remittances (ibid., p.7). An immigrants region of origin is also

correlated with the method they use for remitting. For example, immigrants from the

Dominican Republic, El Salvador, and Guatemala tend to remit using more corporate

structuressuchasbanksorofficialMTOslikeWesternUnionorMoneyGram.Peoplefrom

Vietnam, however, typically rely on more informal methods such as sending money via

friendsorfamily(Houle&Schellenberg,2008,p.12).Someofthisvariationisduetothe

typesandnumbersofmoneytransferservicesoperatingintheircountriesoforigin.

Whileregionisimportanttounderstandingsomeaspectsofremittancebehaviour,it

doesnotexplainallofit,andthedegreetowhichanindividualremitsisdependentona

number of different factors. For instance, by utilizing data from Statistics Canadas

LongitudinalSurveyofImmigrantstoCanada(LSIC),HouleandSchellenberg(2008)found

thatreligion,familyincome,andbeingbetween24-34yearsofagearepositivelycorrelated

with sending remittances. People aged 50 or over, those with families of three or more

children,andthosewithdeeperfinancialconnectionsto Canadaremitless (ibid.,p.20-2).

Unheim and Rowlands (2012), also using data from the LSIC, found that for recent

immigrantstoCanada,alargerincomecorrelatespositivelywiththeamountofmoneysent

inremittances.However,peoplewhohaveanincomeofC$30,000ormoreactuallytended

toremitlessfrequentlythanthoseinalowerincomebracket,reflectingthefactthatmany

remittersareactuallyquitelowincome(ibid.,p.129).

ManymigrantsexperienceoccupationaldowngradinginCanadadespitehighlevels

of education, experience, and expertise. For those immigrants who have high levels of

education,theproblemistheireducationsorpreviousexperienceareoftennotrecognized


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by Canadian employers,resultingin immigrants skills become devaluedinemployment.

Therefore, compared to their native-born counterparts, they often have to take lower

wages (Zuberi & Ptashnick, 2011, p. 64). There are also benefits for some immigrants

Canada compared to other places. For example, Gyoza & Ryabov (2010) compared

BrazilianimmigrantsintheUnitedStatesandCanada,findingthatwhiletheytendtoremit

equallyinbothcountries,theimmigrantswhocametoCanadaseemedtobemorelikelyto

earnmore,belegalresidents,bemorefluentinEnglish,tohavefiledanincometaxreturn,

andtodesiretopermanentlysettleinNorthAmerica(p.179).

Oneconsequenceofremittingthatoftengoesunseenistheopportunityforfinancial

and physical abuse. It has been reported that Sri Lankan refugees in Canada were

intimidatedandcoercedtosendremittancesinsupportofaviolentsecessionistgroupin

their home country (La, 2004). Another significant obstacle facing immigrants living in

Canada are the high fees associate with sending money. Many who use MTOs come to

Canadafromdevelopingcountriesandfeelanobligationtosendmoneytoprovidefunds

thatmayenablefriendsorfamilyintheircountriesoforigintopurchasebasicnecessities.

ThelackofregulationofmoneytransferservicesmeansthatMTOsareunaccountablefor

the fees they set, oftento the detriment ofthose sending and receiving remittances. For

recipientsofremittancesinmanylow-incomecountries,afeeof$10or$15tosend$100

would have high purchasing power. This is money that recipients could spend on basic

necessities.


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ImmigrantsinMetroVancouver

AsignificantnumberofCanadiansareforeign-born.InBritishColumbia,according

tothe2006Censusofthepopulation,26.1%ofresidentsareimmigrants(StatisticsCanada,

2006). Where in the past, many immigrants came from Europe; the largest numbers of

recentimmigrantstoCanadaarefromAsiaandtheMiddleEast.Thefollowingtwographs,

Figure1andFigure2,representthe2006databreakdownbynumberandbypercentageof

immigrantstoCanada.

Figure1:CountryoforiginofimmigrantstoCanadaandMetroVancouverbypercentage

Source:2006CensusStatisticsCanada

0

10

20

30

40

50

60

70

Europe Asia&TheMiddleEast

Africa North&South

America

OceaniaandOther

Countries

Percentage(%

)ofImmigrants

PlacesofOrigin

Canada

MetroVancouver


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Figure2:CountryoforiginofimmigrantstoCanadaandMetroVancouver-bynumber

Source:2006CensusStatisticsCanada

TheCanadiangovernmentgrantspermanentresidencybasedonthreecategories:

1)reunitingfamiliesorfamilyclass(whichincludeslive-incaregivers),2)contributingto

economicdevelopment(whichincludesskilledlabour)and3)theprotectionofrefugees

(GovernmentofCanada,2012).WefirstreviewedtheGovernmentofCanadastatisticsfor

permanentresidencygrantedfrom2008-2012.Wethenaddedthefive-yeartotalsforeach

permanentresidencycategoryandaveragedthemtoprovideuswithinformationforthe5-

yearperiod,whichisdisplayedinthechartbelow.

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

Europe Asia&TheMiddle

East

Africa North&South

America

OceaniaandOtherCountries

I

mmigrants(bynumber)

PlacesofOrigin

Canada

MetroVancouver


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Figure3:PermanentResidencyVisastoCanadaGrantedbetween2008and2012,byclass

Source:StatisticsCanada,CanadaPermanentresidentsbycategory,20082012

Assessing such information is important to determine the diversity of individuals who

immigratetoCanadaandwhomayparticipateinsendingremittances.Muchmorethan

half of the permanent residency visas granted went to economic immigrants, while a

quarterwenttofamilyclassandtheremaindertorefugeesandotherimmigrants.

According to the 2006 Canadian Census, there were approximately 1.1 million

immigrants who landed in Canada in the previous five years (Statistics Canada, 2006).

Most of the immigrants settled in Toronto, Montreal, and Vancouver. 177,840 settled in

BritishColumbiabetween2001and2006,with85%(151,690)settlingintheVancouver

metropolitanarea.Thelargestproportion(16%)ofrecentCanadianimmigrantstoCanada

camefromChina(StatisticsCanada,2006).

62474

161242

24067

9489

FamilyClass

EconomicImmigrants

Refugees

OtherImmigrants


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ThemapofMetroVancouvercensustractsbelow(StatisticsCanada,2006)shows

recent immigrants as a percentage of the total population in each census tract. Recent

immigrants are concentrated in several areas throughout the Vancouver metropolitan

region.Forexample,incertainareasoftheCityofVancouver,upto47%ofthepopulation

ismadeupofrecentimmigrants.WeseesimilarlevelsinseveralcensustractsinSurrey,

RichmondandBurnaby.Ofparticularinterestisthefactthatrecentimmigrantsfiguresare

notuniformlydispersedthroughoutMetroVancouver,butconcentrateinseveralenclaves.

Figure4:RecentImmigrantsasaPercentageofTotalPopulation,MetroVancouver

Source:StatisticsCanada,2006.


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Forexample,somecensustractshavefewrecentimmigrants;thecitiesofCoquitlamand

PortMoodyhaveseveralneighbourhoodswithveryfewrecentimmigrants.

The ways immigrants cluster in particular neighbourhoods is related to multiple

factors.However,thewaysinwhichimmigrantsamalgamateintoaneighbourhoodrelies

greatly ongenerational groups (Fong& Hou, 2009, p. 411). In other words, when an

immigrantfirstarrivesinCanadaheorshewillbemorelikelytoresideinneighbourhoods

withahigherproportionofminoritygroups,becausetheseareascontainstrongpresence

of familiarethnic culture and ethicinstitutions (Fong& Hou, 2009,p.412). However,

FongandHousstudysuggeststhatasimmigrantschildrenandthoseoflatergenerations

assimilate to Canada, they will be more likely to move into communities with majority

groups (Fong & Hou, 2009, p. 412). As we report in the next section of this report,

remittancesservicesinMetroVancouverarehighlyconcentratedinneighbourhoodswith

highproportionsofrecentimmigrants.

Anotherfactorinvolvedinthewayimmigrantsintegrateintoaneighbourhoodor

communityissocialcapital.Socialcapitalcanbedescribedastheaggregateoftheactual

orpotentialresourceswhicharelinkedtopossessionofadurablenetworkofmoreorless

institutionalizedrelationshipsofmutualacquaintanceorrecognition(Portes,1998,p.3).

Socialcapitalprovidesimmigrantswithawaytointegrateintosociety.Immigrantscanbe

apartofaneighbourhoodorgainasenseofcommunitybysocializingandfindingsupport

among other migrants, rather than looking onlyto mainstream institutions. However,

Pearce(2007)suggeststhatavoidingmainstreaminstitutionsmayactuallycounteractan

immigrants feelingofcommunityona nationallevel (p. 10). This idea isrelatedto our

study, as some immigrants expressed during our interviewing process, that making


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relationshipswithothermigrantsintheareamadeforaneasiertransitionintoCanadian

life.Conversely,severalimmigrantsdiscussedhowtheyfeltlonelyandisolatedontheir

initialarrivaltoCanada,whichmaybespecifictothoseintegratingintoethnicenclavesthat

arenotaslargeandwellestablished.Ourresearchconfirmedthefindingsof manyothers

thatanimportantreasonimmigrantssendremittancestotheirhomecountryistosecure

andmaintainaconnectiontofamilyandfriends.

A final factor contributing to neighbourhood and a sense of community is the

relationshipbetweenimmigrantslivinginethniccommunitiesandtheirpersonalincome.

Pearce(2007)proposedthat,livinginethnicenclaveshasanegativeimpactonimmigrant

earnings(p.59).Hearguedthatimmigrantswithhigherincomeshaveastrongersenseof

neighbourhood andcommunitycompared to thosewithlower incomes. Thiscorrelation

betweenincomeandcommunitycouldbeduetoimmigrantshavingmoretimeandmoney

toinvestintocommunityactivities,asaresultofhavingahigherincome(Pearce,2007,p.

20).

RemittanceServicesinMetroVancouver

There are three broad types of remittance services used by residents in Metro

Vancouver. They range from the more formal remittance services including banks, and

MTOs such as Western Union, iRemit, MoneyGram and Ria, to electronic services like

Paypal, text messaging, online money brokers, SKRILL, and foreign banks with online

services. Informal methods also exist and include both the hawala system and sending

moneythroughfriendsandrelatives.


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ThetwolargestMTOs,MoneyGramandWesternUnion,havemorethan332outlets

in Metro Vancouver. MoneyGram hasa contractual relationshipwith CanadaPostandis

located in post office outlets including those in convenience stores and pharmacies.

WesternUnionisinSafewaysupermarkets,paydaylenderssuchasMoneyMart,andmany

independent shops and businesses including travel agents, florists, and gas stations. In

additiontothesetwolargeagencieswithglobalnetworks,therearemanysmalleragencies

thatcanhandlemoneytransferstoalimitednumberofcountries.Insomeneighbourhoods

therearemultipleremittanceagenciesinverycloseproximity.Forexamplethereareat

leastthreeremittanceagenciesina3-blocksectionof6thStreetinNewWestminster,and

theCrystalMallintheMetrotownareaofBurnabyalsohousesthreeremittanceagencies.

Inshort,thereisnoshortageofmethodsandplacestosendremittancesfrom,butasour

researchrevealed;therearesubstantialdifferencesinthecostsassociatedwithdifferent

services. As well, remitters from some countries have many choices when it comes to

sendingmoney,whileremittersfromothercountrieshaveverylimitedoptions.

A first step in our research on the remittance experiences of Metro Vancouver

residentsinvolvedthemappingof remittance services to better understand thephysical

environment in which remittance services exist. Using a tool called SimplyMap

(GeographicResearch,Inc.,2008)weidentifiedtheMetroVancouvercensustractswhich

arehometosubstantialnumbersofrecentimmigrants.Thisresearchexerciseduplicated

the results presented in the map above. We each visited and observed MTOs and

neighbourhoodsinthecensustracts(orinsomecasesadjacenttothecensustracts)with

thelargestproportionofrecentimmigrants.MostoftheMTOsweobservedarelocatedon

streets and intersections with high levelsof vehicular traffic aswell asa fair amount of


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pedestrianmovement.Forexample,aroundtheRealLiquidationFilipinoStoreintheJoyce-

CollingwoodneighbourhoodofVancouver,thebuseswerefrequentduringrushhour,and

thereweregroupsofpeoplewaitingatthebusstopsoneachcornerofalargeintersection.

AlloftheMTOswevisitedaresituatedclosetotransithubs.Wenotedthepatternsofbus

stopslocatedwithincloseproximitytoremittanceservices.Forexample,stepsawayfrom

anMTOonCambieStreetisanentrancefortheCanadaLinesubwaystation,andashelter

fortheCambieStreetbusline,wherethereisusuallyasteadynumberofpeoplewaitingfor

abus.

WefoundthatthemajorityofMTOsinMetroVancouverareinmulti-ethnicareas

and are foundwithin neighbourhoods with many small businesses and services such as

laundromats,postoffices,grocerystores,restaurants,insuranceagencies,thriftshops,and

hairsalons.Theareassurroundingmanyoftheseorganizationsarewell-suitedforone-

stop shopping or running errands. The LadyMarc Filipino Store, which includes a

remittanceservice, islocated in a very busy hub inthe Guildford area ofSurrey.A T&T

AsianSupermarketiswithinwalkingdistanceandtheareainbetweentheT&Tandthis

particularMTOisfullofstripmallswithsmallAsianspecialitystoreswhicharealsoeasily

accessiblebypublictransit.ThestoresthatsurroundmanyoftheMTOsarefood-related

andincludegrocerystories,bakeries,andotherethnicrestaurants.Inourobservations,we

noticed that the people walking along the streets seemed to have a purpose and many

seemed to be running errands (grocery shopping, going to the bank, or going into a

restaurant).

Clearly, most MTOs are located in areas where there is a large population of

immigrants. These neighbourhoods are rich with indicators that people of multiple


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ethnicitiesliveinthearea.Weobservedpeoplespeakingavarietyoflanguagesinmanyof

theneighbourhoodsaroundtheMTOs.AroundtheRealLiquidationFilipinoStoreinJoyce-

Collingwood,a conveniencestorethatcaterstoFilipinoshoppers,weheardbothChinese

andEnglishbeingspokenbypeoplewalkingalongthestreet.Themajorityofbusinessesin

the three-block radius of Real Liquidation have English as well as another language

(includingJapanese,Chinese,Spanish,Tagalog,andVietnamese)ontheirawningsorstore

fronts.

While many of the MTOs are located in well-maintained storefronts and also in

shoppingmalls,somewererun-down.OneremittancestoreinSurreysharesparkingspace

withbudget stores andbusinesses geared to immigrants:a Save-on Cartridge, a Save-on

FujiFilm Products,andan immigration-pardon fingerprinting office. Across the street is

whatusedtobeaChinesebuffetrestaurantwithafadedForLeasesign.Behindisalarge

corporate space, emptyexcept for a Starbucks Coffee occupying part of one side onthe

groundfloor.

TheCostsofSendingRemittances

We used a tool from the World Bank (n.d.) Remittance Prices Worldwide to

compare the costs of sending money from Canada to several different countries using

differentservices.TheWorldBankhascompileddataonthecostsof sendingremittances

from and to varying countries all over the world. Information on Canadian prices was

availableforonlytencountries.Forthepurposeofthisproject,wechosefourcountriesto

compare: China, India, Vietnam and the Philippines, as we were also able to interview

immigrants fromeachof thesecountriesabout their remittance experiences. The World

Bank remittance fee data is reported on the basis of the two amounts of money most


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frequentlysentbyremitters,$200and$500(Canadian).Thegraphsbelowshowthetotal

costasapercentofremittingthesetwoamounts.Thetotalcostasapercentiscalculated

bytheWorldBankandisthetotalcostofaremittancetransfer,includ[ing]thefeecharged

tothesenderplustheexchangeratemargin(WorldBank,n.d.)Todemonstratetheimpact

onfeesbyvaryingamountsofmoneysentandvaryinginstitutions,wedecidedtograph

thepercentageinsteadofflatfees.

The data sets along the Y-axis represent averages from the different types of

sendinginstitutions.Therearetwodifferenttypesofbanks:nationalbanks(thatis,ofthe

country that the money is being sent to. Many of these have branches in Canada.) and

Canadianbanks.Consequently,thisdatawasaveragedtoallowfor comparison.Similarly,

thedatawasaveragedfortheMTOs,althoughonlytwocountriesofinteresthadanational

MTO,(anMTOthatsendsonlytothatcountry),accordingtotheWorldBankdata.Also

included are the costs of using the two major commercial MTOs: Western Union and

MoneyGram.

ThesalientpointthatcanbeseeninFigure5(China)isthedifferencebetweenthe

Canadian bank average and the national bank average. While both types bank is higher

than the MTOs (for $200, at least), to send money through a national bank costs

considerably more (for example, 14.43% for the Chinese national bank) than through a

Canadian bank (6.7%). MoneyGram and Western Union were the least expensive for

sendingbothamountsofmoney.Thisisanoutlierwithinthetenremittancecorridorsfrom

Canada visible in the World Bank data. It is also noteworthy that while the MTOs are

equivalently priced when sending $200, when sending $500, Western Union and

MoneyGrambecomesignificantlylessexpensiveoptions(3.09%comparedto5.16%).


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Figure5:TotalCostofRemitting$200and$500fromCanadatoChina

Source:WorldBank(n.d).Notethepercentageoftotalcostsincludesbothtransferfeesandexchangeratepremiums.

Figure6:TotalCostofRemitting$200and$500fromCanadatoIndia


0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 1516

MoneyGram

WesternUnion

OtherMTOAverage

NationalBankAverage

CanadianBankAverage

Percentage(%)ofTotalCosts

Name/TypeofFirm

$500

$200

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

MoneyGram

WesternUnion

NationalMTO

OtherMTOAverage

NationalBankAverage

CanadianBankAverage


Name/TypeofFirm

$500

$200


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Interestingly,thenationalMTOforIndiaisoneofthemostexpensive(9.18%)ofthe

MTOs, with the global commercial agent (MoneyGram: 6.07%) being one of the least

expensive. The banks follow the common pattern with the Canadian bank average

(13.93%)beingmoreexpensivethanthenationalbankaverage(11.32%)andbothbank

averageshigherthantheMTO.

Figure7:TotalCostofRemitting$200and$500fromCanadatoVietnam


TheVietnameseMTO(accordingtotheavailableWorldBankdata)isbyfartheleast

expensiveoption:3%for$200.MoneyGramisthemostexpensiveoption(10.58%)ofthe

MTOs for Vietnam, particularly when compared with the otherfour countries. For India

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

MoneyGram

WesternUnion

OtherMTOAverage

NationalMTO

CanadianBankAverage


Name/TypeofFirm

$500

$200


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Source:WorldBank(n.d).Notethepercentageoftotalcostsincludesbothtransferfeesandexchan erate remiums.

(6.07%),China(6.07%)andthePhilippines(5.04%),MoneyGramseemstobeoneofthe

leastexpensiveoptions.

ItisinterestingtonotethatinthePhilippines,thenationalbankaverage(5.02%)is

atcomparabletotheMTOs,andissignificantlylessexpensivethanboththeCanadianbank

average(14.41%)andWesternUnion(7.58%).Coinstar,anMTO,chargesthelowestfee

($5 to send $200) while RCB (Royal CanadianBank) charges $45 for the same amount.

SenderstothePhilippineshavemanydifferentsendingoptionswithatleast23MTOsand

banksavailable.TherangeofchoicesgearedtowardstheFilipinocommunityofremitters,

eachwithdifferentfeesandexchangeratepremiums,makesthetaskofchoosingaservice

basedontotalcostdifficult.

Figure8:TotalCostofRemitting$200and$500fromCanadatothePhilippines

0 1 2 3 4 5 6 7 8 9 10111213141516

MoneyGram

WesternUnion

OtherMTOAverage

NationalBankAverage

CanadianBankAverage


Name/TypeofFirm

$500

$200


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Fees

chargedforsendingCanad

iandollars

0510

15

20

25

30

35

Afgh

anist

anBe

laru

sBo

sniaCh

ina

Cong

o Hong

Kong

Hung

ary

India In

done

sia

Isra

elMex

ico Mon

tene

gro P

akist

an Philip

pine

s Sing

apor

e Tha

iland U

zbek

istan

Viet

nam

ReceivingCountries

Fees(CanadianDollars)

MoneyGram$200

MoneyGram$500

WesternUnion$200

WesternUnion$500

Figure9:FeesforSendingRemittancestothe18CountriesofOriginofStudyParticipants

Source:WesternUnionandMoneyGram


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RemittancesthroughWesternUnionandMoneyGram

Wenoted missingdatasetsfromtheWorld Bankdataformanycountries, and in

order to provide a more complete picture, we turned to the Western Union and

MoneyGramwebsitestoresearchthefeesthatthetwocompaniesadvertiseforeachofthe

countriesforwhichweinterviewedsenders.ThesearedisplayedinFigure9above.The

graphdisplaysthefeescharged(in$CAD)forsendingonlineremittancesfromCanadato

countriesthatourrespondentsemigratedfrom.Theseamountsreflectonlythefeeforthe

moneytransfer,anddonotincludetheexchangeratepremiumschargedbybothservices

oranyadditionalfeescharged.TheMoneyGramvalues(blueandmaroon)arebasedonthe

"10minuteservice"(CostEstimator)andifmultipleoptionswereprovided,theaverage

cost was used in these calculations. The Western Union values (green and yellow)

represent the costs to send online, using the Money in Minutes option. For Western

Unionsonlineservices,theirfeesappeartobeonapercentageslidingscaleinsteadofaflat

fee rate for any amount of money sent (for example, we noted that to send $100 to

Indonesia, the cost was $12 (12%), whereas to send $20, the cost was $5 (25%)). For

MoneyGram, the lowest fee appeared to be $10 to send $20 to $50 to Indonesia, a

substantial fee on a percentage basis. Overall, Western Union charges higher fees than

MoneyGram.Feesarefairlystandardizedaccordingtocontinent.ForMoneyGram,theprice

tosend$200or$500tocertaincountriesdidnotchange(feeschargedtosendthosetwo

sumsrangedfrom$10to$20).ForWesternUnion,thesameservicescostfrom$12to$30.

OntheWesternUnionwebsite,therewasalsoaseparateadvertisementtargeting

Scotiabankaccountholders.TheadvertisementstatedthatScotiabankcustomerscansend

remittancesfor$9plus1%ofthemoneysent(WesternUnionTransferService)-$11for


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sending$200;$14forsending$500.Onthissamepage,WesternUnionacknowledges(in

smallprint)thatInadditiontothetransferfee,WesternUnionalsomakesmoneywhenit

changesyourdollarsintoforeigncurrency(WesternUnion,2013).

Advertisements

We searched for advertisements for remittance services in ethnic and immigrant

newspapers collected at the Edmonds and Metrotown branches of the Burnaby Public

Library. We located nine advertisements in newspapers and we found money transfer

servicesadvertisedinChinese,French,Spanish,English,andRussian.Someexamplesare

displayed in Figure 10. While this is not a comprehensive collection, it does offer some

information about the target market for remittance services in Metro Vancouver. It is

importantto notethattheadvertisementin Englishwasin aFilipinonewspaperandthat

theSpanishadvertisementswereinnewspapersaimedatLatinAmericanreaders.

Alsonoteworthyisthatnoneoftheadvertisementswereforbanksorcreditunions,

butwereforothermoneytransferorganizations.Thisincludesbothformalagenciessuch

as Western Union, Ria,andalsoservices within local convenience stores notnecessarily

affiliatedwithalargeragency.


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Figure10:ExamplesofAdvertisementsforRemittanceServicesinlocalimmigrant

orientednewspapers


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SummaryofRemittanceServices

TheinformationsuppliedbyintervieweessupportsthedatafromtheWorldBank

andalsoraisessomeinterestingquestionsaboutthevarietyoffeeschemesavailableand

the complicated process of comparisons, which is not necessarily clear from the World

Bank data. Deciding which service or method to use for remittances is a complicated

process,whichinvolvescalculatingthetransferfeesandthevariousexchangeratesateach

agency orbank. One remitterwe interviewedreportedthathesends between$200 and

$500atatime.Henotedthatthefeesrangefrom$13foramountsupto$200and$16for

amounts higher than $500.This demonstrates one ofthe many fee schemes that can be

applied to remittances. To an extent, the fees for sending remittances depend on the

amountoneissending.

Severalimmigrantremitterswespoketofoundthattheflatratefeesof$15to$18

were too high. One participant noted that while she understands that MoneyMart (a

WesternUnionagent)offersthetransferserviceasa business,thefeesitchargesmadeit

difficultforhertoremitthesmallamountsthatshewasabletosend.

Another respondent remitting to the Philippines used an online service through

Vancity Credit Union, but found that even though the fee was relatively low ($7), the

exchange rate was not as good as she had previously gotten from an MTO. Variable

exchange rates and exchange rate premiums add considerable complexity to choosing a

remittance service. Another interview respondent said that she uses iRemit, a Filipino

servicewithofficesinVancouver.Shechosetheserviceaftercomparingfeesandexchange

rates,andconcludedthatitwastheleastexpensive.LookingatWorldBankdata,wefound

Coinstar to be cheaper ($5 to send $200) compared to iRemit ($10 to send $200). This


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exampledemonstratesthedifficultiessendersencounterwhentryingtochoosethemost

economical and secure remittance method. Besides looking at the fee, one must also

considertheexchangerateoffered,andcalculatethepointatwhichalowerflatfeewould

outweighthecostofahigherforeignexchangerate.

It became clear from our interviews that not all countries have the same

opportunitiesforremittancesasothers.Forexample,accordingtotheWorldBank(n.d.),

there are 23 different options for sending money from Canada to the Philippines. The

interviewdataconfirmedthedifferentialavailabilityofoptions,withrespondentsfromthe

Philippines using multiple services such as iRemit, Metro Bank (Philippines), Western

UnionandVancity.TherearesignificantlyfeweroptionsforsendingmoneytoMexico,so

thatoneintervieweebelieve[d]thatMoneyMart(whichtherespondentlinkedtoWestern

Union)istheonlycompanythatyoucanusetosendremittancestoMexico.

ResearchMethods

TheresearchprojectwasconductedduringtheSpringsemester2013inordertofulfill

the requirements for SA 356 - Ethnographic and Qualitative Methods in Sociology and

Anthropology at Simon Fraser University. In order to learn how anthropologists and

sociologistdoresearch;theclassconductedaqualitativestudytoinformACORNCanadas

Remittance Justice Campaign. ACORN Canada is a grassroots, community-based

organization that advocates for low-income Canadians. The research was designed and

conductedindependentofACORNCanada.

ThemainresearchquestionwetriedtoaddresswasWhataretheexperiencesof

peoplein MetroVancouverinsendingremittances?Studentresearcherswereinterested


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inlearningabouttheparticipantsexperienceswithremittanceagencies,theprocess,fees

and all other aspects of remitting. In order to answer our research problem, we

brainstormed questions to ask, interviewed remittance senders, transcribed completed

interviews,andlastlycodedtheseinterviews.Wedevelopedourresearchquestionsafter

creatingan annotated bibliographyof scholarlyandpopular literature related to money

transfers.Interviewparticipantswerefoundthroughcommunityservicessuchaschurches,

communitycentres,schoolsorpersonalcontacts.

Inordertocollectallthedatathatweneededtoaddressourresearchquestions,we

firstdidathoroughexaminationofthetopicbycreatinganannotatedbibliographytolearn

what informationremittancepractices inCanadaandgloballywasalreadyavailable.This

helpedustodevelopimportantquestionstopursueandrefineourresearch.Secondly,we

visitedneighbourhoodsthathadremittanceagenciesinordertoobservetheactivitiesin

the placeswhere remittance services are located. These observations led us to discover

useful information about the physical and social environment of the businesses that

provideremittanceservices.Somemajorcompaniesthatwereof particularinteresttous

wereMoneyMart,MoneyGram,andWesternUnion.Studentsvisitedandobservedseveral

neighbourhoods and created maps that described the businesses near the remittance

services,thekindsofactivitiescommononthestreetneareachbusiness.

Next,the class, asa whole,brainstormedquestions and topics toincludein semi-

structured interviews with immigrant remitters. Since it was the experiences of actual

remitters that was our target, we hoped that interviewing remitters would answer our

questions. As a class, we decided to concentrate on questions that would permit

participantstofreelyshareinformationabouttheirdailylives,backgroundsandremittance


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stories.Thesewouldbemostbeneficialinenablingustounderstandtheirexperiencesand

perspectives on remitting. Most previous research on the remittance practices of

immigrants to Canada has relied on large-scale survey and census data that, while

important, cannot reveal the actual experiences of immigrant remitters. By conducting

interviewswewereabletodevelopanunderstandingofremittingfromtheperspectiveof

theparticipants.

Oursamplewascomprisedofimmigrantswhohadsentremittances.Eachstudent

hadtoconductinterviewswithtwopeoplewhohavesentremittances.Participantswere

recruitedthroughchurches,communitycentres,personal,andbusinesscontacts.Insome

cases,intervieweesreferredustofriendswhomwewerealsoabletointerview.Though

notarandomsample,theparticipantsdoreflectthevarietyofdemographiccharacteristics

andexperiencesofCanadianimmigrants.

Intotal,weinterviewed33immigrantswhohaveremittedoneormoretimes.Many

oftheresearchparticipantswereregularsendersandhadbeensendingmoneyformany

years.ThelargestnumberofinterviewparticipantsarefromthePhilippines(n=10).We

alsospoketoremittersfromMexico(n=4),Vietnam(n=2),China(n=2),Belarus(n=2)and

one each from Hungary, Indonesia, Bosnia, Pakistan, Hong Kong, Thailand, Uzbekistan,

Afghanistan, Singapore, Israel, Congo, Montenegro, and India. 16 of the interview

participantsweremale;17werefemale.Theoverwhelmingmajority(n=25)havebeenin

Canadabetween6-46years.TheparticipantsinitiallycametoCanadaunderanumberof

differentprogrammesandfordifferentpurposes;allbutonearenowpermanentresidents

orCanadiancitizens.


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Thestudentresearchersadheredtotheethicalprotocolsestablishedforthestudy

andapprovedbytheSimonFraserUniversityOfficeofResearchEthics.Duringrecruitment

and before each interview session, all participants were given verbal and written

information about their rights as research participants and asked to consent to the

interview. They were told that all informationgathered from these interviews wouldbe

keptconfidentialandonlyseenbyprojectparticipants.Ifatanypoint,duringorafterthe

interview,theparticipantwishednolongertobepartoftheproject,theyhavetherightto

withdrawtheirinterviewfromthestudy.

During each interview, student researchers took detailed notes and digitally

recorded the entire interview. We asked open-ended questions that encouraged

participantstoelaborateontheirexperiencessendingmoneyanddealingswithremitting

agencies. Afterwards, the student who conducted the interview wrote a synopsis; these

synopses included the main ideas from the interviews. Most of the 33 interviews were

transcribed.Thestudentresearchersthencollaboratedto developasetofthematiccodes

for the interviews. All of the transcribedinterviews and the synopses were codedusing

Atlas.ti,awidelyusedcomputer-basedtext-codingprogramme.

WhatImmigrantRemittersToldUs

Theimmigrantremittersweinterviewedsendmoneytofriendsandfamilyinmany

differentways.WhilemostusedMTOs,someusedCanadianorinternationalbanks,anda

fewusedmoreinformalmethodssuchasentrustingthemoneytoatravellerorpermitting

arecipienttousethesenderscreditcardorATMcard.Thedecisionabouthowtoremit

depends on many factors. Senders weigh things such as convenience for the recipient,


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speedandsecurityoffundstransferinadditiontothecostofsendingmoney.Forexample

aconstructionworkerwhomovedtoCanadaeightandhalfyearsagousesWesternUnion

tosendmoneytohisrelatives inBosnia. Whilehe knows thathecanreducethe feeshe

paysbysendinglargeramountsofmoneylessfrequently,sendingsmallsumsfrequentlyis

muchmoreconvenientforhisrecipients.Thisisbecausetheycanreceivesmallamountsof

moneyata post office near theirhouse, but have to travel across the city toa Western

Unionofficetocollectlargersums.AFilipinawhocametoCanadasevenyearsagochosea

transferservicethatwilldeliverthefundstotherecipientshome.Sheexplainedthatthe

deliveryserviceisfaster,lessbureaucraticandoffersmoresecurityforherrelativesthan

sendingthroughaglobalMTOorabank.

Manyofthepeoplewespokewithsaidthatspeedoftransferisveryimportantto

them.Insomecasesthisisbecausethemoneyisneededurgently,butinmanyothersa

quickfundstransfergivespeaceof mindtosenderswhoknowthat theirmoneyhasnot

beenstolenorlostintheether.

Q:Haveyoueverhadaproblemsendingmoney?I:problemlikenothaveenoughmoneytosendor?IneverloseanymoneylikewhatIsaid,theyaregood,everything.Q:everythinggood,noproblemlikeifyousendmoneyandtheydidntgetit.I:Yes,IdidcoupletimeslosemyluggagewhenIfliedtoEurope,butInever

loseanymoney.Q:Sosendingmoney,no?I:No.Q:Sotheywillgetmoney?Verysecure,right?


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I:VerysecureIwillsay.Q:Okay.I:Andveryfast.(maleparticipantfromBelarus,10yearsinCanada).

Nearlyalloftheimmigrantsweinterviewedspokeaboutthefeestheypaytosend

money to family and friends in their countries of origin. Most of our participants are

regularremitters,sendingmoneyfrequently(6ormoretimesayear)orinfrequently(5or

fewer times a year) but abiding to a regular schedule, However, because our interview

guidedidnotincludespecificquestionsabouttheamountofmoneyindividualparticipants

sentasremittances,weareunabletocalculatethefeespaidasapercentageofthemoney

sent.Someinterviewparticipantswereuncertainaboutthe costsofremitting,andothers

reportedhighlyvariablefees.Forexample,individualswhouseWesternUnionexpressed

fees anywhere from 4% to 20%, and some reported also paying 12% HST on the

remittancefee.

Participantswerevariedintheiropinionsaboutthefeestheypaytoremitmoney,

withsomereportingthatthefeeswerefair,whilesaidthatalthoughhigh,thefeeswerea

reasonable cost for the service provided. Most, however, found the fees onerous and a

significantobstacletosendingfundstosupportfamily.Onlyremitterswhowereableto

send large amounts of money found the flat fees charged by the banks and the MTOs

advantageous.Mostoftheparticipantsarguedthatflatratesareproblematicforsending

smallersumsofmoneyregularly.

Because,likeifyousendhundreddollars,theyllchargeyoutendollars.Or

evenifyousendfiftydollars,theywillchargeyouagaintendollars(female

respondentfromthePhilippines,2yearsinCanada).


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A home health aide from Pakistan, like several other immigrants we spoke to,

reportedhavingtosaynotomid-monthrequestsformoneypreciselybecauseofthefees.

Shesendsmoneyregularlytoherfamilytocoversomeoftheirbasiclivingexpenses.

I:OnetimetherewasafloodinPakistanandthey[WesternUnion]waived

offtheirfeeforamonthorso.Sothatitwasveryconvenient,youknow,andI

wasabletosendmoremoneyhomeandIdidnthavetonowIhaveto[say

thatIcouldnotsend].IfmymomneedsmoneyandItellher[Icantsendit]

becauseeventosend$100Illhavetospendanother$12/$13,right.Sothen

Ileaveitforthewholemonthandthengo[tosend].

Q:Soyousoyoudothisonceamonth?

I:Onceamonth,yeah,justbecauseitcostsmoney

Q:Allright,andsoyoutrytodoit,itsoundslikeyouthequestionheresays

howoftendoyoutrytosendmoney,butitsoundslikeyousucceedindoingit

everymonth.

R:Everymonth,everymonth.IfIwanttosenditinthemiddleofthemonth,I

dontbecauseIdontwanttospendthat$11.Imightaswellsendit[the$11

fee]tothem[myfamily]andthat,thatmakesmaybelikeonetimefoodfor

mywholefamily(femalerespondentfromPakistan,8yearsinCanada).

Some senders we spoke with have worked out methods to reduce the costs of

sending money. For example, one woman who came to Canada 15 years ago from

AfghanistansendsremittancestoherrelativesinAfghanistanattheendofeverymonth.

Her family doesnot haveasurplusof moneyto send,so she utilizesa system she called

donationboxes.Throughoutthemonth,shecollectsmoneyfromthosewithinherfamily

community who are able to give, and then sends the money to Afghanistan through

Western Union. After she sends the money, she phones her cousin in Afghanistan and

instructshimto designate various portions to various households,accordingto greatest


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need.This money purchasesnecessities: things likefood,medication, andwoodfor fuel.

The sender has an account number [a loyalty program for frequent remitters] with

WesternUnion,andsaidthatthismakestheprocesseasyandcheaperforher.Shemerely

hastoprovideanumber,andpunchinhercode.Withoutanaccountnumber,thefeeshe

quoted was $15 for sending $100.With the account number, she pays$11. For sending

$300,itcosts$17.

Another immigrant, from Mexico, has given his parents the ATM card for his

Canadianbankaccountandallowsthemtomakewithdrawals.

I:afterIstartedtosendingmonthlymoneyIknewitwasgoingtobeexpensivethroughWesternUnion,theychargeaboutIthinkabout$12.Q:$12?I:Yeah,$12andwhentheysenddothetransactiontheyummtelephoneQ:Thecurrencyexchange?I:Thecurrencyexchange.They[myparents]getlessthanwhatIwassupposedtosend.Uhhh,Imeantheonlygoodthingistheygetthemoney

rightawaybutQ:Thatsthebenefitofusingtheseservices?I:Itstheonlybenefit.sothenwhatIthought,whatIthoughtwasIusedtohaveanaccount,uh,IhaveanaccounthereIusedtowithdrawmoneywhenIusedtogotoMexicoAndthenIthoughtokayIamgoingtogivehermy[ATM]cardhereQ:Howoftendoes[yourmotherwithdrawal]money?

I:Onceamonthnow,onceamonth,ummunless,noitsonceamonthbecauseeverytimethey,sheusedmy,shewoulddrawsomemoneyandIwouldpay$5,right.Soinordertonothavethosepay$5,ifIknowthatIhavetogivesomeextramoneytosomebodyelse,soIaskmymomtotakeinsteadoftaking$250totake$300,andthatwayIonlypay$5amonth,

Q:Isitoneflatfeethatyoupayforiteverytimesheusesit?


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R:Itdoesntmatterifyouwithdraw$5or$300,youpay$5(malerespondent

fromMexico,15yearsinCanada).

Immigrantremittancespracticesparallelnon-immigrantCanadiannormsoffamilialsupport

Whileit iscommontothinkofremittancesasa formofdevelopmentaidorwealth

transferfromwealthycountriestopoorones,mostoftheimmigrantremitterswespoketo

are engaged in the same kinds of familial support that are common among many non-

immigrantCanadianfamilies.Accordingtoonerespondent,herfamilyusedthemoneyshe

sentformedicalexpenses:

Oh,andIhaveagrandmaandsheneededsomeonetotakecareofher...We

aresupporting,myfamily.MybrotherandI,wesendsomemoneyevery

monthjusttopaythenurse(femalerespondentfromSingapore,26yearsin

Canada).

Severalparticipantstoldusthat themoneythey send isused formedicalbillsor

nursing care for a sick or elderly relative.Many non-immigrant families inCanada also

assist family members with elder care or medical bills. Several others described their

remittances as loans to a sibling to start a business, school fees for a child, or the

repayment of the loan that allowed the sender to immigrate to Canada. For example, a

restaurantworkerreported,

I borrowed some money from my parents when I was started stay here. Now I

start to have some money to send back. Like a return. So I send them some money

(female respondent from Thailand in Canada for 8 years).

Awoman who came toCanadathree and halfyearsagoand worksfora cleaning

service sends money every month to relatives to help pay the mortgage on a house in


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Mexico,butalsosendsmoneyforspecialoccasionssuchashermothersbirthday.Manyof

ourparticipantssendmoneytocoverschooloruniversitytuitionandfees.

Q:Andsoyouhelpoutyourfamilyfriend,youhelppayforherschoolfees?Isshethe

onethatsinschool?

I:Yes.

Q:Andthenthecousins,isthatthesamething,youpayforschoolfees?Thecousinsor

theirchildren?

I:Mycousinschildrenbecauseshesalready,likeshehasthreechildrenandtheres

anothercousinwhoIamalsohelpinghischildrengotoschoolbuthejustgetshis

moneyfromthefirstcousin.

Q:Ok,ok,sosheactsas,shepassesitalong(femalerespondentfromthePhilippines,8

yearsinCanada).

Just as Canadians support their loved ones, for example, paying for a childs

universitytuition,therearesimilarburdensuponindividualswhosendremittances.While

many remitters are attempting to support their families overseas, there are numerous

consequencesfortheirownfinancialandemotionalwell-being.Inoneparticularinterview,

theparticipantconveyedheremotionssurroundingbothremittingandnotbeingableto

remitasmuchasshewouldlike.

...TheydontexpectanythingfrommebutIfeellikeanobligationandI

knowthatIhavemoreopportunitiesthanwhattheyhavesoIfeellikean

obligationtothefamilyandthenIfeelguilty[when]Icannothelpthemas

muchasIwant(femalerespondentfromMontenegro,1.5yearsinCanada).

AndaccordingtothehomehealthaidefromPakistan:

Q:Wereyouanimportantsourceofincometoyourfamily?


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R:YeahIwaswhenIcamehereandIwasworkingasanannyatthattime

mydadhehadastrokesohewasnotabletoworkanymore.SoIbasically...I

wastheirbreadandbuttersoIalwayssendmoneyfromdayoneuntiltoday

(femalerespondentfromPakistan,8yearsinCanada).

Others,likethewomanquotedabove,havesomewhatambivalentfeelingsaboutsending

money to relatives. And a few worried that sending remittances created unhealthy

dependenciesonthepartofrecipients.

I:Inthesensethatsometimestherecipientsoverthere,wouldfallintothe

illusionthatmoneyiseasytofindhere.Sothat,becausetheyareonlygetting

itoutofthegenerosityofthesenderitcouldbecomeaneasymoneyormad

moneyforthem.

Q:Andkindofadependencyinasensetoo?

I:Yeah,youcreateacertainkindofdependencytheydontbecome

resourcefulintermsoffindingwaysandmeans,oravoidingsituationswhere

intheywouldneedto(malerespondentfromthePhilippines,26yearsin

Canada).

Inadditiontobeingeconomicallyimportanttorecipients,remittancesaresocially

importanttosenders,allowingthemtomaintainimportantrelationships.Formanyofour

respondents,sendingmoneytolovedonesisawaytomaintainsocialtiessinceitcanbe

difficult to visit family members who remain in their homecountry. Remittances enable

immigrantstoexpressaffectionandshowinterestinthelivesandwell-beingoffamilyand

friendsintheircountryoforigin.Forexample,arespondentspoketousabouthowsending

moneytoherparentsinUzbekistanallowshertofeelbetteraboutbeingsofarawayfrom

them.


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Isend[to]mymomanddadbecausetheyarequiteold,andtheyrenot

working,andtheyremymom,sheisonmedication,and[itis]quite

expensiveandjusteventomakemyselfhappy,youknow,Icannotseethem,

Icannotvisitthem,itslikesofar.AndwhenIsendthemoney,itsliketheyre

happy,andImhappy,Ifeel,oh,thatsok,evenImfarIcansendthemmoney

andmakethemhappy,youknow(femalerespondentfromUzbekistan,7

yearsinCanada).

Sendingremittancesisonewaythatimmigrantsmaintainsocialtieswithkinand

friends in other parts of the world. The occasional remitters we spoke to, send gifts of

moneyfor birthdays and holidaysand asa way toexpressaffection totheir lovedones.

Importantly,however,theparticipantswhosefamiliesneedthemoneyforlivingexpenses

or tuition are the ones who send money most frequently. Our interviews showed that

recipients commonly use the money send for food, medicine and education. It is these

remittersandtheirfamilieswhoaremostdisadvantagedbyhighfeesandexchangerate

premiums.

SuggestionsfromParticipants

Mostoftherespondentsinitiallyclaimedthatthefeestheypaytoremitmoneyare

fair. However, when asked to suggest ways inwhich the money transfer services might

improve,itwascommontomentionareductioninfeesratherthanotherqualitiessuchas

security and convenience. Remitters suggested that the Canadian governments should

legislatelowerfeesformoneytransfersorcapfeesoncetheyreachacertainlevel.Asone

participantexplains,thefeeschargedtoremitmoneytoherhomelandareprohibitive:

Becauseifsomebodyissendingmoneyandtheyaremakingtheminimumwage,

paying$12istoomuch.Andifwethinkaboutthemoneyinforexamplepesosis

almost150pesossoyoucanbuyalotofthingswiththatmoneyandmostofthe

peoplethatIhavemettheysendmoneytoMexicoorSouthAmericasoiftheycan


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maketherateloweritwouldbebeneficialforeveryone(femalerespondentfrom

Mexico,11yearsinCanada).

In addition, a couple of respondents suggested that the Canadian government

shouldallowimmigrantstotakeataxdeductionontheirremittancesastheyareproviding

financialsupporttotheirdependents.

Werenotthosespending[the]money[on]ourselves,andwerenotsending

themmoneyjustbecausetheyalreadyhave,anditsmore.No.Itsbecause

theyneed(femalerespondentfromUzbekistan,7yearsinCanada).

ConclusionandPolicyRecommendations

Intakingthisclassandaftercollectinginformationandconductingourresearch,we

havesomeconcludingthoughtsandrecommendations.Someofusweresurprisedtolearn

thatcurrentlytherearenoregulationsconcerninghowmuchmoneytransferagenciesmay

charge theircustomers,andthat fees can beveryhigh tosendsmall amountsof money.

Others found the wide variety of ways that money can be remitted interesting: via text

message,usingon-lineservices,dedicatedremittanceservices,andbanks,andhowoverall

thespeedofmoneytransferemergedasthemostimportantaspectforremitters.

Alsoofinterestisthelargenumberofremittanceservicesinagivendemographic

area.Whileweweresurprisedtolearnoftheextensivewaysmoneycanberemittedandof

the number of services available, we realize that more choice does not always create

competitiveadvantages,butoftencreatesmoreconfusion.Welearnedthatalthoughthere

can be a lot of choice; reliability and security are key criteria, given the hard work and

commitmentthatremittancesoftenrepresent.Ifapersonfrequentsacertainorganization,


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thatorganizationmayoffermembershipcardsaspartofaloyaltyprograminorderforthe

remittertosavemoneyonfuturetransactions.

Afterourresearchandinwritingourreport,weareleftwithsomequestionsand

inquiriesforfurtherresearch.Giventhecomplexitythatthisstudyrevealed,wewouldlike

tobetterunderstandthebehavioursandstrategiesofthosesendingmoney.Someofusare

interestedinthetopicofinformalmoneytransfers,suchashawala.Otherswouldliketo

learnmoreaboutthedevaluingofimmigrantsskillsaffectsremittingpractices.

PolicyRecommendations

Throughourinterviewswithimmigrants,welearnedthatmoneyisusuallysentfor

thepurposeofsupportingfamilymembersintheimmigrantscountryoforigininthesame

ways that non-immigrant Canadians use their money to help support family here in

Canada. Monetarysupport can take the form oftuitionfora childs education,a loanto

helpasiblingstartabusiness,supportforagingparents,skillednursingcareforanailing

grandparent, or support for the basic necessities of life. Where money is being sent to

supportfamily,webelieveremittancesshouldbetax-deductible.

Another recommendation is that remittances below a certain amount should be

chargedapercentageoftheamountsent,insteadofaflatfee.Manyimmigrantswhosend

money are low-income earners and may only be able to send small amounts of money.

Theseremittersaretheoneswhoneedtosendsmallsumsfrequently.Forthesesenders,

percentage-basedfeeswouldalleviateasubstantialburden.TheWorldBanksuggests5%

asthemaximumchargeimposedonCanadiansenders.However,senderscurrentlypay,on

average,8%.


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This leads us to our next and final recommendation. We need to demand full

transparencyanddisclosureofbothremittancefeesandexchangeratespremiumscharged

bymoneytransferagenciesinCanada.Informationalsoneedstobemorereadilyavailable

to immigrants before they choose a money transferorganization. Immigrants in Canada

needtosendmoneytohelpsupporttheirfamilies,whichmakesremittingmoneyahuge

business. It is imperative that governments become involved in regulating fees that

workingimmigrantshavetopayinordertosupporttheirfamilies.


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