A remittance is a transfer of money by a laborer working overseas to their home country; for example, a Vietnamese worker in California sending money to his/her family in Vietnam.

The money transfer turnover via HCMC-based credit institutions saw a relatively strong fall, while the amount of remittances sent through economic institutions surged sharply over the same period last year, said the HCMC branch of the State Bank of Vietnam (SBV).

According to remittance companies, the current global economic turmoil certainly influences the amount of foreign currency transferred to Vietnam.

In addition, the stagnant real estate market and US dollar interest rate ceiling control policy of the SBV have caused a strong decline in big deposits for investment purpose.

Remittance companies are still trying to maintain the turnover in labor export markets such as Taiwan, Korea and Japan.

The major remittance markets are still the US, Europe, Australia and Canada.

The World Bank (WB) said Vietnam’s inward remittances in 2011 were estimated at $9 billion.

According to the HCMC branch of SBV, the amount of inward remittances to the city in 2011 is estimated to have reached around $5 billion, up 10 percent against the previous year and accounting for nearly two-thirds of the country's total.

The remittances mainly came from the US, Australia, and Canada thanks to the sustainable income of overseas laborers in those countries.

According to the WB, Vietnam will be one of the top 16 remittance recipients in the world this year, and is expected to continue being a potential overseas remittance market for global transfer agencies.

The total inward remittance sent to Vietnam in 2010 was US$8 billion, of which the total volume of inflow to HCMC reached over $3.8 billion, up nearly 20 percent from 2009.

In 2009, the total inward remittances sent to Vietnam decreased nearly 13 percent, reaching only $6.3 billion, much lower than 2008's $7.2 billion.

Remittances are one of the most important foreign currency channels in Vietnam, significantly contributing to reducing the current accounts deficit, minimizing the risks in raising capital, and reducing dependence on foreign capital sources of the country.