The Bank of Russia recorded a record 6 …

The Bank of Russia recorded a record 6 … post thumbnail image

The growth of these indicators could be facilitated by “migration amnesty” and simplification of the implementation of cross-border payments.

In the third quarter of 2021, a record volume of transfers of funds from Russia to the CIS countries was recorded in 6 years. Kommersant wrote about this with reference to the data of the Central Bank of the Russian Federation.

When calculating the volume of transfers, Bank of Russia analysts take into account the indicators of all payment systems. In the course of research, experts found that in the period from July to September 2021, $ 2.29 billion was sent from Russia to the CIS countries, which is a record for 6 years. Here are the CIS countries that most frequently transfer money from the Russian Federation to:

  • Uzbekistan ($1.01 billion).
  • Tajikistan ($0.53 billion).
  • Kyrgyzstan ($0.43 billion).
Changes in the volume of cross-border transfers between Russia and the CIS countries over the years. Source: Bank of Russia; visualization: Kommersant

What are the reasons for the growth in the volume of transfers from Russia to the CIS

The Central Bank explains the positive dynamics of the volume of transfers to the CIS with the active entry of labor into the Russian Federation from the mentioned directions. At the expense of the citizens of Uzbekistan, Tajikistan and other Commonwealth of Independent States countries, Russia made up for the labor force deficit. Including, we are talking about the construction industry and housing and communal services.

Citizens of the countries of the Commonwealth of Independent States are attracted to the Russian Federation by favorable working conditions. Newcomers prefer to work in the country and send the money they make home. Thus, the growth in the number of citizens of the CIS countries in Russia supports the positive dynamics of the volume of transfers to the Commonwealth of Independent States.

The positive dynamics of these indicators, according to the sources of the publication, can also be explained by the existence of a “migration amnesty”. The policy taken by the Russian government is the reason for the return of many citizens of the Commonwealth of Independent States to the country.

Other reasons for the positive dynamics of this indicator include the simplification of the cross-border transfer process, the reduction of the transaction fees and the abandonment of restrictions. For example, banks offer market participants to send money abroad using a simplified identifier – a phone number. This initiative also covers the CIS.

In addition, World Bank researchers in May 2021 came to the conclusion that transfers from Russia to abroad are the cheapest in the world.

The cheapest and most expensive transfers abroad. Source: World Bank Study

Improving conditions may cause many market participants to refuse to work with cash, in favor of non-cash. The growing popularity of digital transfer formats, in turn, has expanded the volume of the Bank of Russia’s data on international transactions.

Also, the interlocutors of the publication drew attention to the fact that the trend of increasing the number of transfers from Russia to the CIS may continue in the 4th quarter of 2021.

Recall that Bloomchain previously collected in one material all the important information about the changes awaiting the payment system of the Bank of Russia – SBP in 2022.

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