Sanctions May Complicate Migrants’ Remittances to Families — Asharq Al-Awsat
Economic sanctions and stricter financial monitoring requirements may make it harder for families to access legal channels for remittances from migrants. Álvaro Lario, president of the International Fund for Agricultural Development (IFAD), said this in an interview with Asharq Al-Awsat. According to him, the main challenge is preserving safe, transparent and low-cost channels for legal family remittances while complying with sanctions, anti-money laundering and counter-terrorist financing rules.
According to IFAD estimates, remittances to low- and middle-income countries reached $728.6 billion in 2025, 94% more than in 2016. These inflows exceeded the volume of foreign direct investment in those countries and were more than four times greater than global official development assistance that year.
Risks to Formal Channels
Lario noted that the impact of sanctions on remittances depends on the country, the nature of the restrictions and the financial channels used. The issue may involve not only sanctions, but also how banks and other financial institutions respond to regulatory, compliance and reputational risks.
Even when private remittances are permitted, financial institutions may strengthen checks on transactions linked to certain countries. Restrictions on correspondent banking relationships may also complicate money transfer companies’ access to banking services.
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This approach, known as de-risking, may reduce the number of available formal channels, raise service costs and lengthen the waiting time for funds. As Lario warned, if official remittances become too complicated, expensive or inaccessible, some transactions may shift to informal mechanisms, reducing transparency and consumer protection.
Support for Families and Rural Communities
IFAD estimates that around 220 million migrants and members of diasporas support approximately 1.1 billion relatives. Thus, roughly one in six people worldwide is connected to remittances. About one-third of the funds, or approximately $233 billion, goes to rural areas.
Households receiving these funds invest around $22 billion annually in rural agrifood systems, including agricultural production, rural businesses and employment. In countries experiencing conflicts and economic crises, remittances are used primarily to pay for food, housing, healthcare and education, as well as to build savings and make investments.
According to IFAD, more than half of remittances are now initiated through digital channels, which has helped reduce costs and speed up transactions. At the same time, only 35% of measured services in 2025 were fully digital, both at the sending and receiving stages. Cash is still widely used in many remittance corridors.
