For Nepal’s quake relief, waive remittance fees

The flash floods that struck Nepal on August 26 claimed more than a thousand lives and destroyed livelihoods, homes, farms, and public infrastructure. With reconstruction and the economic recovery now underway, support for the survivors can travel fastest through payment networks and family ties—as is usually the case when disasters strike developing countries.
By waiving fees on these remittances for at least two months, money-transfer companies and banks could help Nepal move from rescue and relief toward reconstruction. Struggling Nepali families would receive more than two and a half times the $49.6 million that the United Nations is trying to raise through its emergency appeal.
Nepal is among the world’s most remittance-dependent economies. Remittances exceeded $16 billion in the last fiscal year, equivalent to more than a quarter of GDP. More than 3.5 million Nepalis work abroad, and the global Nepali diaspora numbers more than six million—one-fifth of the country’s population. These expatriates are sending financial help to families in the affected districts, as are people and charitable organisations of many nationalities. But these transfers will be worth more, and will bring greater relief, if they are allowed to move free of charge.
Remittances are a lifeline. Families use this income for groceries, medicines, and health care. For a flood-displaced household, such transfers are what put a meal on the table and pay for antibiotics that a relief camp cannot supply. Even in normal times, a share of remittance income goes directly into housing. In the weeks ahead, remittances will help rebuild houses, school buildings, and village roads. They will keep children in the classroom, help businesses cope, and restore livelihoods by restocking destroyed shops, replacing lost livestock, and replanting flooded fields.
The remittance industry has waived fees before in response to natural disasters, including after Haiti’s earthquake in January 2010, Pakistan’s floods in 2010, the Philippines’ typhoon in November 2013, and Nepal’s earthquake in April 2015. During the three months following the earthquake, remittances to Nepal increased by 18–26 per cent from the previous quarter, and it is estimated that a fee waiver was worth $40–50 million per month to Nepali families.
Some of Nepal’s own money-transfer companies have already led the way this time, but only for a short period. What is needed now is for the international money-transfer operators and banks that handle the bulk of Nepal’s inbound remittances to do the same.
A fee waiver would be worth even more this year than it was in 2015. According to Nepal Rastra Bank, remittances to Nepal averaged $1.5 billion per month during the last two months, up nearly 25 per cent from a year earlier. If remittances continue at this pace and rise by a further 20 per cent over the next two months—in line with the 18–26 per cent surge seen after the 2015 earthquake—the total would reach about $3.6 billion. A fee waiver would then amount to $126–144 million, assuming an average fee of 3.5–4 per cent for sending $200. And since actual fees can rise to 6–12 per cent on some remittance services, the potential savings may be even larger.
In addition to being several times greater than the UN’s appeal to raise nearly $50 million, such a contribution would be timely and targeted, because the money would be disbursed directly from overseas relatives to the households that know where it is needed. It is also highly likely that a fee waiver would further increase remittance volumes through formal payment networks.
The cost borne by money-transfer companies and banks that choose to help Nepalis in their time of need is entirely manageable. In fact, the revenue forgone in the near term by waiving fees could bring new customers, increase transfers through formal channels, and earn lasting goodwill from families rebuilding homes, farms, and livelihoods. After a disaster of this scale, keeping more of every remittance in the hands of Nepali families is the right thing to do—and sound business. Copyright: Project Syndicate, 2026.