In an initiative led by the European Commission, service providers facilitating remittances to Ukraine signed a joint statement in Brussels on September 27, 2022.
The Joint Statement aims to expand options for affordable and transparent remittances to support Ukrainians and Ukraine. Specifically, the document prioritizes:
- Further promote the provision of remittance services and convergence of associated fees to a target level of 3% (as stipulated in the G20 Sustainable Development Goals and Roadmap for Enhancing Cross-Border Payments).
- Reduce total fees for unilateral and bilateral fund transfers, at least for the duration of Russia’s aggression against Ukraine.
- Disclose the total amount of remittance fees, especially those applicable to the euro and hryvnia exchange rates set by the ECB and the NBU.
- Focus on maintaining the availability of remittance services through the agency network and continuing their digitization.
The joint statement was signed by the leadership of the operators of international payment systems operating in the EU, Ukraine, and elsewhere, and their participants: Visa, Mastercard, Wise, Ria Money Transfer, Extrabanca, Small World, the TransferGo, CB PrivatBank JSC, Oschadbank JSC, UKRGASBANK JSB, Raiffeisen Bank JSC, PUMB JSC, A-BANK JSC, NovaPay LLC, Ukrposhta PJSC and UFG PrJSC.
These banks have pledged to help provide competitive remittance services to the Ukrainian diaspora, to Ukrainians who have fled the war and emigrated abroad, and to those who wish to support the Ukrainian people and remit funds to the country.
The document was signed at a roundtable attended by NBU Vice President Oleksiy Shaban, European Commissioner for Financial Stability, Financial Services and Capital Markets Union Mairead McGuinness, and World Bank Director of Global Practices for Finance, Competitiveness and Innovation (FCI) Jean Pessum. It was signed.
” We thank our international partners and signatories of the joint statement for this initiative and especially for their joint decision to support Ukrainians and their families forced to leave their homes because of the war. We are grateful to all those who have come up with ideas on how to help Ukraine and are looking for ways to implement them and develop existing areas of assistance,” said Oleksiy Shaban. “Reducing the cost of remittances to Ukraine will bring significant cost savings to remittance senders and will firmly contribute to expanding aid to the Ukrainian people. We are confident that our joint efforts will benefit not only the people of Ukraine, but the entire world.”
Ukraine’s payment infrastructure continues to operate smoothly even as the war rages, Oleksiy Shaban said. All the methods that were available in peacetime (international money transfer system, SWIFT, card to card, IBAN) can be used to send money in Ukraine.
When the war started, most international money transfer systems cancelled fees for money transfers to Ukraine altogether, Oleksiy Shaban said. Seven months after the war began, many of them still offer their customers free money transfers to Ukraine-based accounts, with special conditions for transfers from major donor countries. Besides, the international remittance system has become an important channel for international organizations such as the International Committee of the Red Cross to provide humanitarian aid and social payments to Ukrainians; according to early estimates by the NBU
An overall US$7.6 billion was transferred to Ukraine between January and July 2022. Despite the war, this is only 5.7% less than the same period before the war.
This estimate includes remittances through both official and unofficial channels, including banks, international money transfer systems, and post offices.
The war in Ukraine reduced official remittances by about 12%. At the same time, inflows through informal channels increased by almost 3 %.
Almost a quarter (24 percent) of the funds transferred to Ukraine from abroad in January-July 2022 went through the international money transfer system.According to the NBU, as part of the joint statement signed today, the international system will reduce transfer fees by They will be lowered. This will favor more secure channels for remittances to Ukraine. It is hoped that this will further encourage the development of more transparent, accessible, and competitive remittance services and mitigate the impact of the humanitarian crisis.
