Push for Bringing Down Cost of cross-border Remittances

India has made a strong case to reduce the cost of cross-border remittances to promote international trade at the World Trade Organization (WTO

New Delhi has submitted to the multilateral trade body that “promoting interoperability and interlink ages of digital payment infrastructures, including fast payment systems”, can be one of the means to achieve cheaper, faster and more transparent and accessible cross-border payments.

The global average cost for sending remittances is 6.18%, higher than the sustainable development goal to reduce it to less than 3%.

Around 78% of total remittances go to low-and middle-income countries, India said, making a case for a multilateral effort to address the issue. Lower transaction costs are key to reducing inequality within and among countries such as India.

According to the World Bank, India is expected to have received nearly $125 billion in remittances in 2023, the highest in the world. A reduction in costs would encourage even greater flows.

India has proposed that a work programme should examine the drivers of costs of cross-border remittances and challenges associated with reducing it, and identify the opportunities created for lowering the cost of cross-border remittances due to digitalisation and the emergence of new technologies.