The COVID-19 Pandemic, Remittances and Financial Inclusion in the Philippines
Recent literature has revealed that financial inclusion enhances economic opportunities and security in developing countries. Moreover, a greater inflow of remittances can promote inclusiveness. In this paper, we explore the potential impacts of the COVID-19 outbreak on financial inclusion by focusing on its detrimental effect on remittance flows to developing countries. Using a household-level dataset collected in remittance-dependent regions of the Philippines prior to the outbreak, we confirm that remittances are associated with financial inclusion, particularly for women. We then utilize the 2020 GDP forecasts made by the IMF and the World Bank before and after the COVID-19 crisis to gauge the potential impacts of the pandemic on financial inclusion through the change in flow of remittances. Our projection shows that a substantial decline in remittances caused by the COVID-19 crisis may have an adverse effect on financial inclusion in the Philippines, which is more serious for women.
Key words: financial inclusion, SDGs, COVID-19, remittance, migration, Philippines