This year, it's estimated that more than $30 billion will be sent from the United States to families in Latin America. This money isn't coming from the U.S. government. It's coming from dishwashers, janitors, construction workers, from immigrants who've come to the United States to make money so they can send it back home to their families. So-called "remittances" have been a standard part of the immigration story for a long time now, but as VOA's Maura Farrelly reports, business leaders and policy makers have only just begun to recognize how important this money is to the global economy.

A Spanish-language soap opera plays over the television set in this small, narrow shop on West 231st Street in New York City. All of the signs inside the store are in Spanish. Posters advertising money transfer services feature pictures of women, children and elderly parents the primary recipients of the thousands of dollars wired from this shop to Latin America every day. Store clerk Alexandra Crespo helps a customer named David fill out an international money transfer form. David's been to this shop before, but the forms have changed slightly since the last time he was here.

David is a construction worker. Every two or three months, he sends a few hundred dollars to his girlfriend in the Dominican Republic. He says she uses the money to take care of his son.

David: My son, I send for him to buy food, medicine, clothes, something like that.

Farrelly: Is it very necessary?

David: Yeah, yeah. It's very necessary that somebody help. I try.

David is one of about 10 million people in the United States who regularly send money to family members in Latin America. There are nearly 17 million Latin American immigrants in this country. And according to a recently released study commissioned by the Inter-American Development Bank, they earn around $450 billion every year. Most of that money is spent in the United States. But about $30 billion of it is sent to families in Central and South America.

Manuel Orozco is a researcher with the Institute for the Study of International Migration at Georgetown University. As he runs through a country-by-country list of remittance figures, Mr. Orozco notes that in some nations, income earned by workers in the United States accounts for about 20 percent of the money circulating in the country's economy.

"El Salvador, $2.2 billion. Guatamala, $2.3 billion. Nicaragua, a very poor country in the hemisphere and the world gets $800 million out of a $3 billion economy," he said. "And when you compare it to exports, for example, the volume is quite dramatic. Sometimes for a country like Nicaragua, remittances are far greater than the total exports that the countries have."

In spite of the significant contribution remittances are making to the economies of Latin America, Manuel Orozco says policy makers in most countries, Mexico being a notable exception, haven't really taken steps to leverage this income. Mr. Orozco says studies have shown that families receiving remittances tend to save some of that income, but most of them are saving the money in jars or drawers in their homes.

"This is a fundamental development issue for the developing world. In Latin America, less than 20 percent of the people have bank accounts," he said. "And you have a fundamental structural [problem] constraining development there, because you basically don't have enough assets to build on, because of the very limited access to financial institutions that people have.

Mr. Orozco says the U.S. government has recently begun to recognize the importance of remittances. Both the House and the Senate are considering bills that would require businesses to clearly disclose all of the fees involved in a money transfer. Additionally, the United States Agency for International Development has been working with financial institutions in Latin America, encouraging them to become money transfer agents.

Manuel Orozco says as more and more institutions have entered into the money transfer market, competition has driven down the cost of sending money home. Just five years ago, the typical fee was about 15 percent of the total amount of money sent. Today it's around seven percent and Mr. Orozco expects it will go down even more.

"Businesses both in the U.S. and Latin America realize that there is a lot of money to be made through the servicing of remittance transfers," he says.

While the amount of money being sent to families in Latin America from immigrants in the United States is significant, Manuel Orozco says it would a mistake to assume that this money is sufficient. He insists that remittances could be put to better use if the financial infrastructure in Latin America were more developed. However, he says the $30 billion coming from Latin American workers in the United States isn't going to eradicate the poverty and social inequality that sent those workers to America in the first place.