In April 2026, the sending of family remittances registered the largest year-on-year contraction of the last decade, according to the most recent data from the Central Reserve Bank (BCR).
The flow of funds from abroad, considered one of the main economic pillars of El Salvador, showed a reduction that has modified the financial dynamics of thousands of families and local commerce. According to official figures from the BCR, in April 2025 the country received 7.72 million dollars in family remittances. Comparing that figure with the income for April 2026, the report shows a decrease to 5.44 million dollars, which represents 2.28 million dollars less in a single year.This setback equates to an approximate decrease of 29.5% for the analyzed period. The authorities attribute this behavior to external factors that condition the sending capacity of the migrant community, mainly residing in the United States.
Among the factors identified by the BCR and private analysts, the following stand out:
- Persistent inflation in issuing countries: Although inflation indices show some moderation compared to previous years, the cost of living in the United States and other developed nations remains high. The increase in the prices of rents, services, and basic products forces migrants to allocate a greater proportion of their income to cover their own needs, limiting the margin available for family transfers.
- Slowdown in the international labor market: Sectors that traditionally employ migrant labor, such as construction, services, hospitality, and commerce, are showing a slower growth rate. Overtime hours and temporary employment opportunities have decreased, which impacts the ability to send remittances.
- Changes in migration and labor policies: Recent modifications in employment and migration policies in United States generate uncertainty among undocumented and temporary workers. Faced with the fear of unforeseen adjustments in permits or regulatory changes, many migrants choose to set aside a portion of their income as an emergency fund, instead of remitting it immediately.
Direct Consequences on Local Commerce and Consumption
Faced with this situation, the drop in remittances directly affects commercial activity and tax revenues. The BCR estimates that about 90% of remittances are used for immediate consumption. The contraction of $2.28 million in April 2026 was reflected in a reduction in daily purchases in retail and the service sector. Shops, markets, and small businesses perceived a drop in sales, which in turn impacted the indirect tax collection.For the moment, April’s data reflects a stage of moderation and caution for the Salvadoran family economy. The attention of decision-makers and productive actors is focused on the evolution of migration flows and the response of international markets, in a scenario characterized by uncertainty and the need for adaptation.
