IOM and its partners highlight the impact of migrants’ economic contributions at International Banking Forum

For the second year in a row, IOM Azerbaijan brings the topic of remittances to the forefront of discussions at the International Banking Forum, the most authoritative finance and banking event of the region organized by the Azerbaijan Banks Association, Central Bank of Azerbaijan and MasterCard.

During the 7th International Banking Forum, held on 1-2 November 2023, IOM organized panel discussion titled “Remittances and Financial Inclusion of Migrants” within the “Enhancing the Socioeconomic Benefits of Remittances in Azerbaijan” project, funded by the IOM Development Fund and implemented in cooperation with the State Migration Service. The aim of the panel discussion was to present the importance of migrants’ economic contributions to their families back home in the South-Eastern, Eastern Europe and Central Asia, to highlight socio-economic benefits of remittances, as well as to explore ways to maximize these benefits jointly with private sector.

At the panel, moderated by Mr. Hurshid Rustamov, economist of the UN Resident Coordinator’s Office in Azerbaijan, it was noted that the importance of migrants’ economic contributions to their families back home is now more important than ever, especially for low- and middle-income countries (LMICs). Ms. Maria Bassermann, project officer at the IOM Regional Office in Vienna, informed that the total amount of remittances received in South-Eastern, Eastern Europe and Central Asia region last year was USD 72 billion, on average 11% of national GDP. In low- and middle-income countries, remittances and migrants’ savings exceed overseas development assistance (ODA) to these countries 5 times. Furthermore, Ms. Bassermann noted that “to increase the positive impact of remittances for development, a focus needs to be put on improving migrant decision-making in sending remittances, reducing costs of sending remittances, enhancing financial Inclusion of migrants and remittance recipients.”

Ms. Khayala Mammadova, senior specialist at the Central Bank of Azerbaijan, commended the IOM-implemented project that increased attention to problems related to financial inclusion faced by migrants. Hence, an action plan for improving the legal and regulatory framework is being drafted and training programs on financial inclusion for migrants will be prepared within Central Bank’s financial literacy activities.

Mr. Elvin Afandi, Head of Corporate Strategy & Research of the Islamic Corporation for the Development of the Private Sector, highlighted contribution of digitalization of remittances to enhancing financial inclusion of migrants and their families. Mr. Matthieu de Heering, Head of Russia, Central Asia and Caucasus at the SWIFT, presented regional perspective on cross-border low-value payments.

Apart from joining to the panel discussion, visitors also had a chance to learn more about remittances and financial inclusion of migrants at the IOM stand for two days. In total, 7th International Banking Forum was attended by more than 1000 participants representing government agencies, commercial banks, and businesses, including fintech companies, international financial institutions, and non-governmental organizations from the USA, Türkiye, European Union, Commonwealth of Independent States, Middle East, and other countries.

The IDF-funded project encourages all actors engaged in the remittance market to acknowledge and act upon opportunities and best practices that can contribute to achieving the SDGs, and particularly SDG 10.c which calls for reducing to less than 3 per cent the transaction costs of migrant remittances and eliminate remittance corridors with costs higher than 5 per cent by 2030 and Objective 20 (Promote faster, safer and cheaper transfer of remittances and foster financial inclusion of migrants) of the Global Compact for Safe, Orderly and Regular Migration (GCM).

Recording of the IOM-organized panel discussion at the 7th International Banking Forum: IOM organized panel discussion at the 7th International Banking Forum held in Baku - YouTube

For more information on remittances and Azerbaijan, refer to the IOM assessment report “Digital Remittances in Post-pandemic Azerbaijan: Supply- and Demand-side Analysis.”