Determinants of remittance channels amongst immigrants in South Africa

Luhabe-Morrison, Lumko Ndumiso

Determinants of remittance channels amongst immigrants in South Africa

Master Thesis

2019

Abstract

South Africa, being viewed as the centre of opportunities and enormous business prospects, is noted as having a long history of migrants, stemming from the South African Development Community region, seeking employment opportunities, both legal and illegal. Extant literature shows that there is a substantial flow of remittances from South Africa to other countries in the SADC region. Due to stringent South Africa's migration laws, many of these migrants remain undocumented, and hence use informal channels to remit to their countries of origin. This study investigates the determinants of remittance behaviour, which includes choice of remittance channels and level of remittances amongst immigrants residing in South Africa. This research contributes to the development finance (regional remittance market) body of knowledge by looking at South Africa within the SADC context. The research methodology employed was quantitative in nature, several statistical techniques were used to analyse the data including descriptive statistics with frequency tables, correlation, and binary logistic regression. SPSS and Stata 12 were used for data management and all statistical calculations. The descriptive statistics, including tallying of frequencies in the calculation of percentages, and central tendency summaries were used to summarise the data and present the sample profile and characteristics; binary logistics was used to test the three hypotheses on relationships and influences of the dependent and independent variables of interest. The findings of the study showed that sex, age, rental payments, and household expenditure were significant determinants or influencers of remittance behaviour. Furthermore, it showed that more immigrants were male, as compared to female immigrants in this study. This study concluded that since sex, age, rental payments, and household expenditure are significant determinants of remittance behaviour, the government, banks, and other stakeholders need to review their policies to create a platform that enables ease of remittances. Keywords: remittances, remittance channels, determinants of remittances, immigrants, remittance levels.

Keywords

Finance

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