Leveraging Remittances with Microfinance: Samoa Country Report

This report investigates how MFIs can leverage the large flow of remittances into Samoa. Remittances constitute 23% of the country's GDP and need to be understood in their specific socio-cultural context. Despite high remittance levels, their contribution to overall household budget is relatively small. The study found that:

• Households receive remittances primarily for social occasions as opposed to conventional household expenditure;
• Commercial banks and non-banking financial institutions facilitate remittance flows to Samoa;
• Remittances are primarily transferred through international money transfer agencies and international commercial banks;
• Complex regulations make remittances difficult and time-consuming;
• Households are satisfied with the level of remittance transfer services, but concerned about financial and geographical accessibility and limited variety in products/services.

Policy recommendations for MFIs include:

• Exploring the possibility of transforming into a licensed money changing agency;
• Partnering with other organizations with legislative mandate to explore remittance products;
• Introducing innovative remittance-related products and services to clients;
• Exploring and adopting new technologies to increase the client base and to offer value-added services.