Effects of Diaspora Remittances on Recipient Household Poverty Alleviation in Kenya

Abstract

Remittance flow to developing countries have increased in volume, this has drawn attention of scholars, organizations and governments from various parts of the world who pay keen attention to diaspora populations and are keen to establish what related activities they do. Kenya having her population as part of the global diaspora community is not excluded from the latest developments around the subject. This study sought to establish whether the practice of remitting financial income to households in the country of origin has effects on the recipient household poverty status. The study was based on desk review and analysis of secondary data form 10 percent of the Kenya Population and Housing census of 2019. The census collected information on emigrants from household members to establish how the financial resources remitted was utilized. The theories applied in this study were Altruism, Investment and Insurance. The results showed that according to statistics from the Central Bank of Kenya, remittances to Kenya in the last three quarters of the year 2022 amounted to USD 2,992,505,680 trillion. The results from the census indicate that the bulk of the remittances were used on household consumption (40.8 percent), followed by education (28 per cent), Health (20.5 Percent) and investment being the least (13.4 percent). These show that recipient households had additional income sourced from remittances which cushioned the pressure on household budgets and other expenditures. The effect of this expenditure on household poverty could not be established from the data used in this study, however this can be implied from the utilization of remittances.