Unbanked migrant workers in the United Arab Emirates are set to benefit from digital currency remittances, providing their low-cost, efficient infrastructure for sending payments to families overseas for the first time. As the UAE moves towards opening the first licensed crypto exchange, the country’s migrant population is eagerly awaiting the availability of wallets and digital currency transfer platforms to reduce the costs of remittances and improve the efficiency of cross-border transactions.
UAE is the world’s second-largest remittance economy.
UAE is the world’s second-largest remittance economy, with millions of migrants regularly sending money to support family and friends in their home countries. However, these largely unbanked migrants have to queue in the heat for some time to access expensive, slow money transfer services to send money back to their families who live in different countries. According to a Reuters report, the move towards digital currency remittance will enable migrants to remit funds from their smartphones for instant transfers to their destination countries and it will also save workers heavy transaction fees that they have to pay under the current system.
The remittances sector makes up 12% of the economy of the country.
According to the report, out of the 9 million residents of the UAE, around 80% are expatriates, who send over $43 billion annually to other countries around the world. Only behind the United States in global remittances, the remittances sector makes up 12% of the economy of the country. However, there remain some barriers to introducing licensed cryptocurrency exchanges in the Western Asian country, namely the need for regulation, which is continuing to shape up under the consideration of local authorities. Several other countries are opening up to crypto exchanges and the crypto industry.