HIGH remittance costs are eating into money sent home by Pacific workers, prompting Reserve Bank of Fiji Governor Ariff Ali to call for urgent regional action to make cross-border payments cheaper, faster and safer.
Speaking at the Pacific Regional Conference on Cross-Border Remittances in Suva yesterday, Mr Ali warned that the Pacific could not afford to ignore the financial burden facing families who depend on money sent from overseas.
“Remittances to low and middle-income countries are now close to US$700 billion a year, more than foreign direct investment and official aid combined,” he said.
“For small island open economies like ours, they are a vital shock absorber, for households and the balance of payments. Remittances is a lifeline for the Pacific families and their economies.”
However, he said the cost of transferring money remained a major obstacle, particularly for small and remote Pacific markets.
“Sending money home still costs too much.”
Mr Ali said some Pacific remittance corridors faced costs above the global average of about 6.5 per cent, compared with the United Nations Sustainable Development Goal target of three (3) per cent.
“And to compound this misery, the new US levy on remittances is something the Pacific cannot afford to stand by.”
He said remittances represented much more than financial transactions, helping families meet everyday expenses and maintain connections across borders.
“For Pacific families, remittances are care, sacrifice and love sent across an ocean.
“They help pay school fees, cover medical expenses, put food on the table and provide assistance during difficult times.
With Fiji’s remittance inflows expected to reach a record $1.6 billion this year, Mr Ali said the region needed to ensure more of that money reached its intended recipients. He identified five priorities for regional co-operation:
Reducing transfer costs;
preserving access to correspondent banking and international payment networks;
strengthening interoperability;
protecting customers against financial crime; and
extending services to underserved communities.
He said differences in regulatory requirements could create barriers to innovation and increase operating costs for service providers.
“Therefore, aligning our rules for the financial sector would help our small markets work like one larger one.”
Mr Ali also highlighted the growing role of digital financial services in making remittances more accessible.
He said in Fiji, mobile network operators’ share of total remittance inflows increased from about one-third in 2023 to more than half in 2025.
Mr Ali said digital remittances could also improve financial inclusion by connecting people to savings, credit, insurance and other services.
However, he warned that expanding digital services must go hand in hand with stronger protection against cyber threats, scams, fraud and financial crime.
He also called for greater financial literacy, improved digital skills and better access to services, particularly for women and people living in rural and remote communities.
Mr Ali said Pacific nations needed to work together to address shared challenges and ensure cross-border payments became more affordable and reliable.
“Our responsibility is to ensure these hard-earned funds reach families safely, quickly and at the lowest possible cost.
“Our goal is to turn remittances from a lifeline into a launchpad for savings, small business, and security for the next generation.”
