Rajesh Khanal

Dashain and Tihar are the times when people pull out all the stops and spend lavishly without a second thought. In recent years, rising remittance inflows have made the festival an even more joyous occasion.

According to the 2010-11 Nepal Living Standard Survey, 55.8 percent of Nepali households receive money from family members working abroad. They receive an average of Rs 80,436 per year, and this has helped to make Dashain extra special.

The number of households receiving remittance has been rising due to an increasing flow of migrant workers. Dashain is the time when migrant workers send the most remittance compared to other occasions. 

Rajendra Pandit, director at the foreign exchange department of Nepal Rastra Bank (NRB), said the increasing number of migrant workers had helped to increase the inflow of remittance significantly. “As money circulation also increases during Dashain, the country witnesses a major percentage of the remittance inflow during the festival,” he added.

As per official records, 7.30 percent of the total population is working in various countries, but the actual number is estimated to be much higher. A majority of these workers are between the ages of 20 and 23 while the major destination countries for foreign employment are Malaysia, Qatar, Bahrain, Saudi Arabia, Dubai, Japan and the US, among others. They have been a big source of money for the high expenditures during the Dashain festival.

Those dealing with remittance said that remittance inflows rise during the festive season. They said that a recent appreciation of the US dollar also encouraged migrant workers to send more money home. People spend a lot of money to eat sumptuous food and buy new clothes and luxury goods.

Chandra Tandan, managing director of City Express Money Transfer Agency, said that there had been a growth of 20-25 percent in remittance inflows before the Dashain festival. “Had the recent surge in the US dollar not slowed lately, there would have been a growth of at least 35 percent,” he said. City Express said it conducts annual transaction worth Rs 40 billion and holds a 10 percent market share in the remittance business.

Rajeev Upreti, in charge of Western Union Business at Nabil Bank, said the festive time usually witnesses a 30-40 percent higher inflow of remittance compared to normal times. According to him, transactions during the festival account for about one-fifth of the annual transactions.

Nabil has been working as a principal banking agent of Western Union Money Transfer. Upreti said Nabil’s major business in this segment comes from remittance from the US and Europe. According to him, they have been providing remittance service from over 1,250 locations across the country.

Service providers said they see a larger volume of transactions targeting Dashain mainly in the first week of October. “As the time is the regular schedule for receiving salaries by most of the migrant workers in foreign countries, they mainly send remittance during the period,” said Munal Jung Karki, business development executive at Prabhu Remit. According to him, business during the period doubles compared to normal times.

Karki said they were receiving an increasing amount of remittance from the US and Japan in recent days. Prabhu has been offering the service from 3,500 agents throughout the country. According to Karki, they have made formal tie-ups with 22 domestic commercial banks and international companies like Express Money, Money Gram, EZ Remit and Transfast in order to enhance their service. Meanwhile, International Money Express (IME), which claims to hold 30-35 percent of the country’s remittance business, also said that the country received 20-30 percent of the total annual remittance during Dashain.

“With a rise in the dollar, a growing number of migrant workers and changing consumption habits of the people, we have expected remittance inflows to grow 25-30 percent this year compared to last year,” said IME’s chief executive officer Suman Pokharel.

Published on: 7 October 2013 | The Kathmandu Post