Reconciling the benefits of formal and informal remittance channels : a Zimbabwean migrant’s perspective

Abstract

Policy makers and financial institutions advocate the use of formal (regulated) remittance channels as the best way to harness remittances. In this research I study the benefits of formal and informal remittance channels from a Zimbabwean migrant’s perspective. The factors, particularly the Zimbabwean migrant’s demographics, adopted country and channel variables will influence the migrant’s choice of remittance channel. Categorical and numerical data that influence the choice of remittance channel used was collected from Zimbabwean migrants resident in South Africa, the United Kingdom and the United States. Categorical date was analysed using a log linear model - correspondence analysis which explores relationships between two or more dimensions. Numerical data was analysed using correlation analysis to examine linear associations and relationships between variables. The research is intended to create an understanding of what influences the migrant’s choice of remittance channels which could assist the policy makers (particularly in Zimbabwe and South Africa) understand how to best harness both remittance channels and improve the financial structures if they hope to increase the migration of remittances from informal to formal remittance channels.Copyright