Diaspora remittances continue to grow the African continent

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Cash Inflows of diaspora remittances into Kenya have gradually increased over the last seven years, rising from USD 1.291 billion to USD 3.094 billion in 2020.

Remittances reached USD 829 million in the first three months of 2021, the largest amount ever reported in any quarter.

The majority of diasporas send money home at least once a month, if not multiple times a month.

A report by Samawati and Blue Inventure reveals that men, on the other hand, send more money home than women.

Financial support to family and friends accounts for 49percent of remittances, while 15percent is used to investigate their business, property, or real estate back home.

While 12 percent invested with the intention of generating long-term income for their families back home.

Diasporas with family in their home countries are more inclined to transfer money or invest than those who do not.

The diaspora’s five main investing options include:Investment in one’s own or a partner’s business, Family-owned business investment, Investment in local enterprises that aren’t owned by a family, Investing in the stock exchange and investment in private equity .

The real estate construction industry received the majority of private diaspora investments.

The biggest source of investment cash is obviously income.

When a person residing abroad decides to invest in their home country, they hope to earn returns that are comparable to or higher than current market rates.

Muslims in the African diaspora are particularly interested in investing in their homeland.

The level of investing knowledge has a direct influence on current investment decisions.

Hawala is preferred by 48 percent of Muslim diasporas for remitting payments back to their homeland. In the Somali community, Hawala is the most often used mode of money transfer.

The absence of Sharia-compliant banking in Kenya has aided the establishment of the Hawala system.

One major concern for diasporas is that they dread of being too far away to handle their investments back home is the primary anxiety of most diasporas.

Also, they don’t know who they can trust to counsel or handle their finances on their behalf.

Some diasporas discover that the funds they sent were used for other personal purposes without their knowledge.

When accepting funds for investment, some recipients cut off communication.

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