Report: Remittances to Ghana increased to US$3.6 billion in 2020

Remittances to Ghana increased by 5% to US$3.6 billion last year, World Bank’s 2021 Migration and Development report has said.

Ghana was ranked second behind Nigeria benefiting significantly from remittance flows last year.

According to the report, with the exception of Nigeria where there was a significant decline in remittances, foreign inflows to Africa went up by 2.3%.

“Remittance flows to the region were estimated to have declined by 12.5% in 2020. The decline was almost entirely due to a 27.7% decline in remittance flows to Nigeria, which alone accounted for over 40% of remittance flows to the region.”

“Excluding Nigeria, remittance flows to sub-Saharan African increased by 2.3%, demonstrating resilience at a time of crisis. Indeed, strong remittance growth was reported in Zambia (37%), Mozambique (16%), Kenya (9%), and Ghana (5%)”, the report added.

Top remittance recipients in sub-Saharan Africa in 2020 (US$)

2021 projection

In 2021, remittance flows to the region are projected to rise by 2.6%, supported by improving prospects for growth in high-income countries.

Data on remittance flows to sub-Saharan Africa are sparse and of uneven quality, with some countries still using the outdated Fourth IMF Balance of Payments Manual rather than the Sixth, while several other countries do not report data at all.

High-frequency phone surveys in some countries reported decreases in remittances for a large percentage of households even while recorded remittances reported by official sources report increases in flows.

The shift from informal to formal channels due to the closure of borders explains in part the increase in the volume of remittances recorded by central banks.

Remittance costs

Sub-Saharan Africa remains the most expensive region to send money to, where sending US$200 costs an average of 8.2% in the fourth quarter of 2020.

Within the region, which experiences high intra-regional migration, it is expensive to send money from South Africa to Botswana (19.6%), Zimbabwe (14%), and to Malawi (16%).

According to the report, despite COVID-19, remittance flows remained resilient in 2020, registering a smaller decline than previously projected.

Officially recorded remittance flows to low- and middle-income countries reached $540 billion in 2020, just 1.6% below the 2019 total of US$548 billion.

The decline in recorded remittance flows in 2020 was smaller than the one during the 2009 global financial crisis (4.8%).

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