Del Otro Lado: Financial Behavior of Households Receiving International Remittances in the Mexico Financial Diaries

This report, Del Otro Lado (From the Other Side): Financial Behavior of Households Receiving International Remittances in the Mexico Financial Diaries, aims to provide insight into the financial lives of remittance recipient households in Mexico and to inform both private and public sector initiatives to leverage migrant remittances for wealth building throughout Latin America and the world. The Mexico Financial Diaries study involved 185 families, over 14 months, from November 2013 to January 2015. For this report, 16 families receiving international remittances during the project were studied in detail. 

The research finds that remittance income is just one of many sources of income for the families participating in the study. On average, households earned income from 6.5 different sources, including remittances. The study found that families direct the majority of their remittance income towards daily household expenses, including increased spending on healthcare, better quality food, and education. In addition to meeting their basic household needs, recipients also leverage remittance payments as a sort of insurance mechanism, and request money in the case of emergencies or an unexpected need.

Recommendations from this study include the following: 

• Expand payment options in underserved areas; 
• Increase options for the direct payment of goods and services by the migrant; 
• Develop remittance-linked credit products to facilitate investment and reduce household vulnerability; 
• Explore the use of flexible savings incentives, rather than rigid commitments to respond to remittance income volatility; 
• Promote financial products and messaging using the concept of ‘investment’ rather than ‘savings’; 
• Help consumers make decisions about financial instruments;
• Do more to communicate information about options to migrant remittance senders abroad.