MOLDOVA: Compensation of Employees and Personal Transfers, Inflow of Foreign Cash via Informal Channels 


The Balance of Payments Division of the National Bank of Moldova (NBM) applies a comprehensive model to estimate the cash brought in the Republic of Moldova by individuals; the estimated data are included in the balance of payments in the items related to personal remittances.

Scope, Methodology, Compilation Practices, and Data Sources


Estimating the size of foreign cash “brought in pockets” in the Republic Moldova, to be included in the remittances-related items of the balance of payments.

The necessity of estimating the informal inflow of remittances in cash by natural persons was initially driven by:

  • the increasing outflow of economic migrants in the beginning of the 2000’, low financial literacy of migrants and their low confidence in the banking system,
  • high dollarization of some domestic markets (e.g. real estate), and the flows of foreign exchange captured by some data sources that are not directly related to balance of payments statistics and that could not be explained.

Over time, the economic reality of the country changed and the judgmental model applied for the estimation of informal inflow of remittances in cash became more detailed and was linked to other statistics (e.g. migration statistics, labor force statistics). The last developments consist in the distribution of cash remittances by main geographical regions.


Judgmental macroeconomic model (based on the balance technique).

Data sources
  1. Statistics collected by the National Bank of Moldova:
  • International Transactions Reporting System - Summary report on international banking transactions,
  • Money transfers of individuals (made through licensed banks, money transfer operators and postal offices),
  • Assets and liabilities in foreign currency of authorized banks of the Republic of Moldova - data on foreign cash holdings,
  • Cash receipts recorded in/ released from the accounts of individuals of authorized banks,
  • Transactions made by foreign exchange offices of authorized banks,
  • Currency sale / purchase transactions made by independent foreign exchange offices,
  • Foreign currency cash taken out from/ brought to Moldova by authorized banks.
  1. Data sources for key household spending categories where foreign exchange in cash is typically used, collected by other national authorities:
  • Transactions with real estate (Agency for Land Relations and Cadastre)
  • Average market prices of real estate (Real estate agencies)
  • Number and value of cars imported by individuals (Customs declarations database)
  1. Migration and labor force statistics
  • Labor Force Survey (National Bureau of Statistics)
  • Population Census (2004, 2014)
  • Specially Designed Surveys (CBX-AXA, IOM)
  1. Other data sources
  • number of residents and non-residents who crossed the border (Frontier service)
  • available statistics of partner countries (e.g. Russia - money transfers, working permits)
  • economic situation in partner countries of interests for Moldovans.

Compilation Practices

In order to estimate the inflow of remittances in the form of foreign cash in the country through informal channels (other entries than via licensed banks, money transfer operators and postal offices), the main possible types of spending of total cash from remittances are analyzed. Such as: the evolution of resident individuals' deposits (new deposits in FX cash and withdrawal of deposits) the evolution of cash in foreign currency held by licensed banks (including the export-import of cash in FX by banks), the turnovers of foreign exchange offices, and the evolution of real estate and motor car markets. Some spending of cash for education, medical assistance and traveling abroad is estimated, too. The propensity to save of individuals receiving remittances from abroad and the evolution of households' consumption are also taken into account. In effect, cash remittances are derived as the difference between all estimated foreign exchange spending (outflows) and the known (from formal channels) remittances inflows.

Linkages Across Statistical Domains

The estimates are incorporated in items related to personal remittances in balance of payments and in the national accounts (the rest of the world).

Current Challenges and Conclusions

  1. The model relies on many assumptions. Individuals’ behavior may change over time, that is why empirical verification of assumptions is important and requires periodical appropriate surveys to be conducted; however, specialized surveys are conducted very rarely.
  2. Unfortunately, no comprehensive and reliable counterpart data are available. Moldova’s balance of payments and implicitly remittances statistics do not include data for a part of territory called Transnistria, which is not under control of Moldovan authorities. The counterparts’ statistics include data for the whole territory, that is why our statistics are not comparable. Even with this concern, in 2011 the NBM made an attempt to reconcile its data on remittances with Russia. Despite the above-mentioned inconsistency, that attempt was successful.
  3. The geographical distribution of cash received via informal channels remains a challenge.
  4. The model estimates the total inflow of remittances from the perspective of demand (spending) -based approach (and then the informal inflow of remittances in cash is derived), therefore it is impossible to distinguish between flows coming from informal, underground or illegal activities.

Annexes - International accounts: compilation methodology and data sources