Journal Article

Beyond Control? The mechanics and Dynamics of ‘Informal’ Remittances Between Europe and Africa

Published 1 January 2007 / By Nicholas Van Hear,Frank Pieke, Anna Lindley

Back to Publications

Policy making usually assumes that the best way to harness migrant remittances for development is by shifting them into the regulated money transfer sector. However, much research evidence concludes that alternative methods are often cheaper and more reliable, accessible and convenient. In this article, we explore this tension between policy objectives and evidence. Based on a review of remittance mechanisms in seven sub-Saharan African countries, we question the validity of the distinction between ‘formal’ and ‘informal’ remittances. We conclude that the formalization of remittance systems should not be approached as a regulatory task carried out from the top down, but as a bottom–up evolutionary and organic process that should be encouraged. We suggest that the current regulatory thrust in this area is likely to be counterproductive, since it risks undermining the many vibrant institutions emerging through the movement of migrants and their money, together with their potential to enhance much needed economic and social development.

Van Hear, N., Pieke, F. and Lindley, A. (2007) 'Beyond Control? The mechanics and Dynamics of ‘Informal’ Remittances Between Europe and Africa', Global Networks, 7(3): 348-366