Definition: Remittances

United Nations terminology

The United Nations Technical Subgroup On Movement of Persons – Mode 4 agreed on the following four definitions of remittances:

(a) Personal transfers;
(b) Personal remittances;
(c) Total remittances;
(d) Total remittances and transfers to non-profit institutions serving households (NPISHs).

"Personal transfers" consist of all current transfers in cash or in kind made or received by resident households to or from other non-resident households.

Personal transfers thus include all current transfers from resident to non-resident households, independently of (a) the source of income of the sender (be it wages and salaries, social benefits or any other type of transfers, including transfers from a person receiving no income and running down his/her assets); (b) relationship between the households (be it between related or unrelated persons); and (c) purpose for which the transfer is made (be it inheritance, alimony, lottery, etc).

"Personal remittances" = Personal transfers + compensation of employees (excluding social contributions, taxes on income and wealth, travel expenditure and passenger transportation related to employment of non-residents) + capital transfers between households.

Personal remittances reflect the inflows to a household either from another household or from a member of a household working abroad.

"Total remittances" = personal remittances + social benefits.

Total remittances include personal remittances and social benefits  directly to households from other institutional sectors, namely corporations, government and non-profit institutions serving households (NPISHs).

"Total remittances and transfers to non-profit institutions serving households (NPISHs)" = Total remittances + Current transfers to NPISHs + Capital transfers to NPISHs.

As credit entries, total remittances and transfers to NPISHs would thus cover all flows from abroad which are either receivable by households directly or indirectly through NPISHs in the home countries for the benefit of households.
Source:
United Nations Statistics Division/DESA, "DEFINITIONS OF REMITTANCES", UN/POP/MIG-5CM/2006/15, United Nations Technical Subgroup On Movement of Persons – Mode 4, FIFTH COORDINATION MEETING ON INTERNATIONAL MIGRATION, Population Division, Department of Economic and Social Affairs, United Nations Secretariat, New York, 20-21 November 2006
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