Relief from high remittance costs
"Many Pacific people living permanently or working temporarily in New Zealand, regularly remit money home to their families," Helen Clark said.
"Currently the average cost of remittances to the Pacific is between fifteen and 25 per cent of the monetary value of the remittance, thus greatly reducing the value of their earnings.
"The Labour-led Government wants remittance transfer services between New Zealand and the Pacific region to be transparent, lower cost, safe, and efficient. Spearheaded by work undertaken by the Ministry of Pacific Island Affairs, NZAID, and the Reserve Bank of New Zealand, the goal is to reduce the transaction cost of remittances to between five and seven per cent by 2009," Helen Clark said.
"This month our government is releasing a discussion document on a proposal for a remittance card facility regulation. The new regulation would make it possible for mainstream financial institutions to offer a two-card remittance transfer facility using international ATM and EFTPOS networks. This facility would allow people to load money on to a remittance card account in New Zealand and then have family or friends withdraw that money in the Pacific. This process would incur much lower transaction fees than do current arrangements.
"The new regulation could be in force by the end of September, paving the way for commercial products to come on the market," Helen Clark said.
Remittances to the Pacific region tripled over the past decade to reach US$425 million, according to recent figures from the World Bank. New Zealand is one of the main source countries. The World Bank says unofficial or unrecorded remittances could add at least another fifty per cent to the official estimate.
Juli Clausen (in Niue) Satellite phone 00881621458581
Kathryn Street (in NZ) 04 471 9477 or 021 511 669
The Ministry of Justice has published a consultation paper on a proposal for a new regulation under the Financial Transactions Reporting Act 1996 that will affect customer due diligence requirements for qualifying remittance card facilities.