Remittances to Nicaragua (money sent home by those living and working abroad) totaled US $500.4 million in the first three months of this year, 2021. That is US $75.9 million more than the same period last year, or a growth of 17.9%.
Those in the United States sent the most (61.3%), second was Spain (15.4%), then Costa Rica (13.3%) and Panama (3.5%).
The US $306.5 million sent from the United States was an increase of 28.9 percent with respect to the same period last year. That put the average US transaction at US $252.06.
Money from Spain was up 11.7% and from Costa Rica it was down by 10.7% which made the average transaction from Costa Rica worth US $115.07 dollars.
Money transfer agencies and banks received most of the money with US $498.2 million (of the US $500.4 million) between them. The spilt was agencies 34.7% and banks 64.9%.
The average amount per transaction was US $165.1 by agency and US $257.9 through the banks.
Other Central American Countries also reporting a growth in remittance income were the Dominican Republic (up 49.6%), Honduras (up 33.0%) and Guatemala (up 31.2%).
The last report on Remittances to Nicaragua for January and February 2021 showed a 9.4% increase (US $ 27.7 million) on the same period in 2020.
As you can see from the BCN report, any money sent back to Nicaragua by financial institutions or money transfer businesses is carefully tracked by the Central Bank of Nicaragua (BCN – Banco Central de Nicaragua).
In April 2019, new rules required that remittances of over US $500 must be reported to the Financial Analysis Unit (Unidad de Análisis Financiero or UAF by its acronym in Spanish). This applies to “financial or non-financial institutions” that offer the remittance transfer service.
The report must identify the name of the issuer and the beneficiary. The UAF was created through the Law of the Financial Analysis Unit and the Law against Money Laundering, Terrorism Financing and Financing the Proliferation of Weapons of Mass Destruction.
Trivia
In January 2019, during the time when the National Assembly were reviewing the proposed new tax law (Law of Reforms and Additions to Law 822, Law of Tax Concertation) a “typing error” led to rumors that the government were going to tax remittances at 15%. The reaction was a very quick clarification and announcement from the leader of the National Assembly (parliament) categorically stating that there would be no such taxes applied to the remittances. The error was changed, the law proceeded to the approval stage and was introduced on February 28th, 2019.
Kelvin,
Do you have any ideas WHY the remittances are increasing? What things happened (are happening) that caused the increases?
I think its the economy being down here requiring more money be sent to families. I don’t think those abroad are doing that well that they don’t need the money where they are.
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