Reserve Bank of India (RBI) data reveals a surge in fund outflow under the Liberalised Remittances Scheme (LRS). In June, outflows reached $3.89 billion, a significant rise from May’s $2.88 billion and June 2022’s $1.98 billion.Global Remittance Trends
Reserve Bank of India Data Reflects Notable Growth in Remittances
Remittances spiked ahead of the deadline for tax collected at source (TCS), growing 35% month-on-month in June 2023 and 96% compared to June 2022. Notably, LRS outflows increased across equity/debt investment, property purchase, overseas deposits, and supporting relatives abroad.
Although the government postponed TCS implementation to October 1, 2023, residents can still remit up to $250,000 abroad yearly without prior RBI approval. Kosovo experienced a surge in foreign remittances, reaching 633 million euros in the first half of the year, up from 555 million euros in 2022’s same period. In June alone, remittances totaled 121.8 million euros, compared to 104.9 million euros in June 2022. For 2022, total foreign remittances to Kosovo grew 5.1% to 1.2 billion euros.
LRS Outflows Surge, Kosovo and Philippines
In the Philippines, remittances from overseas Filipinos maintained an upward trajectory, marking a six-month high. Cash remittances in June totaled $2.812 billion, up from May’s $2.494 billion and a 2.1% increase from June 2022’s $2.755 billion. The growth stemmed from receipts by land- and sea-based workers. Year-to-date cash remittances rose 2.9% to $15.793 billion.
Leading the sources of remittances were the United States (41.1%), followed by Singapore (6.9%), Saudi Arabia (5.9%), Japan (5.1%), and the United Kingdom (5.0%). The United Arab Emirates, Canada, South Korea, Qatar, and Taiwan also contributed significantly, with the rest accounting for 20.5%. Additionally, personal remittances, encompassing cash and in-kind transfers, rose by 2.2% to $3.131 billion in comparison to the same month the previous year. Workers with contracts over a year sent around $2.48 billion, while those with shorter contracts sent approximately $570 million.