At least 281 million people worldwide live outside their country of origin, and many more have migrated internally, within their countries. People migrate for various reasons, but the most common types of migration are labor migration - estimated at 169 million people in 2019 - and forced displacement - estimated at 108.4 million in 2022. The population of forcibly displaced people (FDPs), who have had to leave their homes due to conflict or persecution, includes 35 million who have crossed international borders to seek safety in another country and are considered refugees, as well as 63 million who have fled home but remained within their own countries and are considered internally displaced people (IDPs).
For all those who migrate, financial inclusion is a key element for their well-being and incorporation into host economies. Access to a range of financial services can help them build resilience and take advantage of opportunities as they settle in to new environments, as well as send money to help their families back home. However, migrants and refugees face many obstacles to gaining access to financial services that are truly helpful and geared towards their needs and situations.
Overcoming these obstacles requires efforts from multiple stakeholders - including policymakers, multilateral institutions, financial service providers, mobile money providers, humanitarian organizations and researchers. We need research to better understand migrant and refugee needs. We need financial products and services, including digital solutions, designed to meet those needs and and put the migrant experience at the center. We need to share experiences serving refugees and migrants in order to continue learning and improving. And we need policies, both national and global, which facilitate migrants’ and refugees’ financial inclusion.
This FinDev Editor's Collection provides you with a guide to navigating the growing selection of knowledge resources focused on advancing financial inclusion for migrants and forcibly displaced people.
Disasters and Conflict | Refugees | Remittances
Financial Inclusion for Refugees and Forcibly Displaced People
Forcibly displaced people (FDPs) - a population which includes both refugees and internally displaced people (IDPs) - have been largely overlooked as a viable segment by the financial industry, perceived as too risky. A major misconception is that refugees are constantly on the move and will only remain for a short while in their host country, while the reality is usually quite different. It is crucial, therefore, to better understand FDPs and their needs for financial services, and to share experiences with serving this population to continue learning and advancing financial inclusion for this segment.
This study brings to light the challenges forcibly displaced persons face in accessing economic opportunities and puts forth a financial health framework for measuring progress against these challenges.
Setting the Global Agenda for Refugee Financial Inclusion
At the Global Refugee Forum in 2019, a coalition of multiple stakeholders and actors formed to bring attention to the topic of financial inclusion for FDPs. This group consists of multilateral institutions including AFI, Better than Cash Alliance, CGAP, the ILO and UNHCR; bilateral institutions from Germany (GIZ), the Netherlands, Norway and the UK; and NGOs including the International Rescue Committee (IRC). After agreeing on a set of recommendations to advance financial inclusion for FDPs, this group formed a Community of Practice on Financial Inclusion for FDPs which now includes other nonprofits, independent consultants, private sector and academia.
By acknowledging financial inclusion of forcibly displaced persons (FDPs) as a priority development issue, the G20 can help promote enabling policy and regulatory environments that provide fair, safe and sustainable access to the financial services FDPs and their host communities urgently require.
ADDITIONAL RESOURCES ON UNDERSTANDING REFUGEES’ NEEDS
- Shifting Perspectives: From Financial Inclusion to Financial Health of Forcibly Displaced Persons (FDPs) (FinDev Blog, Dec 2021)
- Financial lives of Lebanese and Syrian Refugees in Lebanon (Paper, Altai Consulting, Apr 2019)
- Assessing the Needs of Refugees for Financial and Non-Financial Services - Jordan (Paper, Grameen Credit Agricole Microfinance Foundation, SIDA, UNHCR, Jul 2018)
- Assessing the Needs of Refugees for Financial and Non-Financial Services - Uganda (Paper, Grameen Credit Agricole Microfinance Foundation, SIDA, UNHCR, Jul 2018)
- Refugees and Their Money: The Business Case for Providing Financial Services to Refugees (Paper, FSD Africa, UNHCR, Access to Finance Rwanda, Mar 2018)
ADDITIONAL RESOURCES ON SHARING EXPERIENCES PROVIDING FINANCIAL SERVICES FOR REFUGEES
- Financial Inclusion for Refugees and Migrants in Latin America (FinDev Blog, Jun 2023)
- Financial Inclusion of Refugees in Jordan: Knowledge Note (Paper, GIZ, Nov 2022)
- Making Finance Work for Refugees: UGAFODE’s Journey in Serving Refugees and Host Communities in Uganda (Paper, ILO - Social Finance, Jan 2022)
- Making Finance Work for Refugees: Microfund for Women, Experience in Serving Refugees and Host Communities in Jordan (Paper, ILO - Social Finance, Mar 2021)
- Outcomes of Microcredit Provision to Syrian Refugees (Case Study, Lebanese Association for Development (Al Majmoua), CoopMed, Dec 2019)
- Refugee Access to Financial Services in Jordan (Paper, UNHCR, Mar 2019)
- Economic Inclusion of the Poorest Refugees: Building Resilience Through the Graduation Approach (Paper, UNHCR, Trickle Up, CGAP, Mar 2017)
ADDITIONAL RESOURCES ON DIGITAL FINANCIAL SERVICES FOR REFUGEES
- Challenging Exclusion: Refugees' Uptake of Mobile Money (Paper, Jordan Payments and Clearing Company, Mar 2021)
- COVID-19 and Refugees’ Economic Opportunities, Financial Services and Digital Inclusion (Paper, IRC, Nov 2020)
- The Digital Lives of Refugees: How Displaced Populations Use Mobile Phones and What Gets in the Way (Paper, GSMA, Sep 2019)
- Partnering With the Private Sector to Extend Digital Financial Services to the Unbanked (Paper, GIZ, Mar 2019) - Syrian refugees
- Humanitarian Payment Digitisation: Focus on Uganda’s Bidi Bidi Refugee Settlement (Case Study, GSMA, Nov 2017)
- Landscape Report: Mobile Money, Humanitarian Cash Transfers and Displaced Populations (Paper, GSMA, May 2017)
Financial Inclusion for All Migrants
The world’s population of migrants is very diverse, covering a multitude of different migration pathways and journeys. Refugees are part of this group and often have needs specific to the refugee experience that may not overlap with all other migrants. Because of the acute need to respond to refugee situations, the financial inclusion sector has developed more resources on how to provide financial services for forcibly displaced people in recent years than for other types of migrants.
However, labor migrants also have their own specific needs, such as better and more affordable access to remittance services. And there are commonalities across all migrants that can be addressed by financial service providers, policymakers and other stakeholders. For example, migrant workers and refugees often face discrimination, as well as language and literacy barriers, and difficulties acquiring the required identity documents to access financial services and employment.
For labor migrants, the financial inclusion sector has focused largely on remittances - making sure that migrant workers have access to affordable and convenient services for transferring money home to their families, and that these remittances can provide a gateway to access to the formal financial system for their recipients in home countries. The World Bank, IFAD, the Inter-American Development Bank (IDB) and many other multilateral institutions work actively in this area. More recently, there has been a focus on insurance and pensions for migrants as well, with UNCDF and Toronto Centre exploring these products as a way of building migrants’ resilience.
KNOMAD
The Global Knowledge Partnership on Migration and Development (KNOMAD) is a global hub of knowledge and policy expertise on migration and development issues.
World Bank
Supervising Migrant Insurance and Pensions
This TC Note explains why insurance and pensions for migrant workers is an important area of focus for supervisors.
Catalyzing Financial Inclusion: Gender-Inclusive Fintech Solutions for Migrants
This report digs into the financial inclusion obstacles disenfranchised migrant populations face in three Sub-Saharan Africa, the Middle East and North Africa, and South and Southeast Asia.
Village Capital, Swiss Agency for Development and Cooperation, Impact-Linked Finance Fund, Austrian Development Agency
Making Remittances Services More Accessible
Migrant Money
Migrant Money is a UNCDF initiative which works to improve migrant remittances and related financial services. It contains a comprehensive library of research, insights and toolkits for public and private sector partners.
United Nations Capital Development Fund (UNCDF)
Applying a Gender Lens to Digital Remittances
Digital remittances can form a gateway to better financial health and inclusion for migrants and their families. Yet one key factor influencing remittance behavior is often overlooked: gender.
Harnessing Digitization for Remittances in Asia and the Pacific
This report discusses the importance of remittances in Asia and the Pacific, the key challenges faced by the industry, and the impacts of the COVID-19 pandemic.
Asian Development Bank