When Financial Infrastructure Becomes Humanitarian Infrastructure—How remittances can speed Venezuela’s humanitarian and economic recovery

Last month, the U.S. Treasury provided much-needed regulatory relief for financial institutions supporting Venezuela’s economic recovery and reconstruction after the recent devastating earthquakes. Together with sanctions licenses issued earlier this year, the measure shows that Washington understands that jump-starting Venezuela’s economy will require more than humanitarian and post-disaster assistance. However, these measures might not be enough.

When the news of the twin earthquakes first broke, the world’s response followed a familiar script: search-and-rescue teams mobilized, humanitarian organizations coordinated emergency relief, and governments pledged and delivered assistance.

Venezuela’s recovery, however, will depend on a combination of different kinds of support. One in particular receives far too little attention: the financial infrastructure that allows millions of Venezuelans living abroad to support those back home.

The scale of Venezuela’s diaspora makes this especially consequential. After almost three decades of economic mismanagement by the regime, almost nine million Venezuelans, roughly 25% of the country’s population, live abroad. In the aftermath of the earthquakes, many are doing what families around the world have always done during times of crisis: send money.

Figure 1: Family Remittances from the U.S. to Venezuela

Source: Author’s calculations based on surveys, money-transfer data, and migrant interviews.

These transfers are often viewed as private financial transactions. But they also perform a key economic function that will be paramount to the country’s long-term recovery and economic reconstruction.

Three realities make this clear.

First, families are best suited to allocate critical support according to individual needs. Centralized organizations struggle to plan assistance efficiently for millions of unique circumstances. One household may need medicine for an elderly parent; another may need to replace roofing materials; while a third may need transportation to return to work. Families, on the other hand, possess information that institutions can hardly replicate. With resources at hand, they can mitigate conditions under key emergencies.

Second, remittances do more than support the households that receive them. They also help restart local economies. When a family receives money from relatives abroad, they spend it locally, helping businesses large and small get back to work. Currently, close to four million households receive remittances—in a country with seven million households, these person-to-person transfers have an immediate effect on private consumption. Those businesses, in turn, hire workers, replenish inventory, pay taxes, and purchase from other local suppliers, creating a virtuous cycle that extends well beyond the original recipients of the remittance.

Lastly, humanitarian assistance is designed to address urgent needs during emergencies, not finance reconstruction efforts. Funding for these efforts typically peaks immediately after a disaster, when global attention is at its highest, and then declines as coverage moves on; other disasters inevitably strike, as happened on August 11 in Colombia, and donor priorities shift. Remittance flows, by contrast, are recurring, economically significant, and a direct source of relief for communities. Recognizing that the diaspora is uniquely positioned to sustain recovery and reconstruction should be a central pillar of Washington’s policy toward Venezuela.

In 2025, remittances to Venezuela were estimated at around US$6 billion (~6% of GDP), with about 50% originating in the U.S. More troubling, about 85% of these funds are sent via unlicensed transfer methods, mostly because of costly regulatory restrictions and disadvantageous conversion rates for users. These informal financial flows lack appropriate anti-money-laundering (AML) and fraud oversight and thus should be a focus in any plan to support the country’s long-term recovery.

This is why the U.S. Treasury’s recent regulatory measures are a step in the right direction. In June, the Office of Foreign Assets Control (OFAC) issued General License 60, authorizing transactions related to earthquake relief efforts in Venezuela that would otherwise be prohibited under U.S. sanctions; it expires on October 23, 2026. Later in July, the Financial Crimes Enforcement Network (FinCEN) announced that it will not pursue certain supervisory or enforcement actions against U.S. financial institutions providing Treasury-authorized financial services in Venezuela; this measure too is temporary and expires on January 29, 2027.

The easing of these measures positively affected the Venezuelan economy through remittances; the number of transactions sent through licensed money transfer companies increased dramatically thanks to these policy changes, and it also contributed to reducing the size of the exchange rate differential between the official and parallel markets from 73% to 13% in the past eight months, while the entry of US dollars helped domestic consumption.

Reducing friction in financial flows to Venezuela is precisely what the country needs at this critical moment. Yet temporary regulatory relief is not a substitute for the long-term certainty required to rebuild the country’s financial infrastructure. Money transfer companies cannot establish banking relationships, operational processes, and distribution networks overnight, nor can they make sustained investments based on temporary authorizations.

Greater regulatory certainty would encourage broader participation by regulated financial institutions, expanding the availability, affordability, and reliability of services for the Venezuelan diaspora. As reconstruction continues and the diaspora plays an increasingly important role in supporting families back home, cross-border payment systems should be viewed not as emergency tools but as a core component of Venezuela’s long-term recovery.

For decades, humanitarian support has focused heavily on the logistics of delivering aid. That investment has saved countless lives and should continue. But if long-term recovery is the objective, policymakers and regulators should devote greater attention to the financial infrastructure and private-sector channels that allow families to support one another and enable legitimate capital to reach the country.

Claudia Garavini is a business executive with experience in payments, stablecoins, capital markets, and investing across Latin America. She is vice president of strategy and business development at Felix, a rapidly growing financial services company backed by QED Investors and Castle Island Ventures among others. She holds an MBA from Harvard Business School and a bachelor’s degree in economics from Universidad Metropolitana in Caracas, Venezuela, where she was born and raised.