Women living in the African diaspora send more money home for household activities and needs than men.
The report submitted to Pangea Trust by Samawati Capital Partners and Blue Inventure Limited conducted in the period of April-June 2021 reveals that on the other hand, men send funds home for investment purposes.
“We see the diaspora as a largely untapped resource in developing countries. Together with new partners we want to come up with solutions to end poverty in developing countries. For the world to reach SDG SIDA has decided to engage other partners to reach the diasporaSofie Berghald.
“The volume of remittances from January to September 2021 have increased by 20percent in comparison to the same time frame in 2020.According to the CBK, one of the key drivers of the remarkable growth in remittances has been financial innovations,” said Co-founder Samawati Capital Partners Samuel Ndong’a.
According to the analysis that involved 211 respondents’ the trend by women to prioritize money for household needs has been attributed to the desire to meet the various needs of families back at home.
“This could be because they have a deeper understanding and appreciation of the household needs of their relatives back home,” the report reads in part.
The greatest concern by most of the diaspora members surveyed was that they feared being too far away to manage their investments back home and did not know or trust any organization that could advise or manage investments on their behalf.
However, there remains a high appetite for investment opportunities in Africa from the diaspora with nearly 56 percent who had never invested in Africa in the past were interested to start and receive more information about investing.
Out of those who are already investing, the Kenyan diaspora had the highest exposure to investments at 42percent on private, business, stock markets, while 31 percent of the Muslim diaspora and 18percent of the other African diaspora reported as having exposure.
The report further shows some of the key drivers for growth in Islamic investments include oil revenues from the Islamic States, increasing propensity for ethically driven products and the rise of enabling institutions.
The respondents were divided among three sub groups which included Kenya Diaspora (59), Africa Diaspora (68) and Muslim Diaspora (84).
The first phase consisted of detailed desk review of recent relevant reports and other authoritative research publications on diaspora remittances and investments.
The second phase consisted of an online survey of 60 questions containing both close-ended and open-ended and qualitative and quantitative questions.
Voluntary (opt-in) sampling method was used to invite participation from respondents from 3 identified sub-groups.
At the same time, women in diaspora often send home amounts less than Sh55, 875 while most men send amounts greater than Sh111,750.
The analysis further acknowledges that male diaspora either earn more or have more disposable income than female diaspora.
“More men than women reported that the remittances accounted for less than 5 percent of their total income, which indicates that the men earned higher incomes than their counterparts,” the report highlights.
“Majority of the diaspora are Tech savvy and are used to tech-based platforms therefore adoption of investment platforms would be easier for them. The level of wide access to information made possible by the online platforms has been a huge motivator,” said Chief Executive Officer and Co-founder Blue Inventure Jeff Temba.
On the other hand in Kenya, migrant workers send on average Sh22,360 or Sh33, 540 home every one or two months.
The remittances represent 15percent of what they earn on average, and what they send can make up as much as 60percent of a household’s total income for millions of families.
The remittances in Kenya have risen to become the biggest source of foreign exchange, ahead of tourism, tea, coffee and horticulture exports.
The Central Bank of Kenya has for instance indicated that Kenyans in diaspora continue to make significant contributions to the socio-economic development of the country through the remittances and investments they send to Kenya.
“This was also echoed by some key informants, who highlighted during the interviews that the choice of the channel of remittance by the remitter was to a larger extent informed by how convenient it was to the recipient. In addition, as cash is the most ubiquitous means of payment, channels which could most easily convert payments into cash are more acceptable for recipients hence preferred by remitters,” reads the report.Pangea Trust
In the year 2020, remittance inflows grew despite the impact of COVID-19 in the source countries.
According to CBK remittance inflows rose to a record high of USD 3.094 billion in 2020, accounting for 3percent of GDP from USD 2.796 billion in 2019.
This represents an increase of 10.7 percent.
The United States of America typically accounts for the bulk of Kenyan remittances reaching about 53.85 percent on average, followed by the United Kingdom at about 7.44 percent while South Africa comes in third place accounting for about 6.34 percent.