Thursday, 15 August 2013

Mo Farah supports campaign to stop the closure of money transfer services

One of Great Britain's top athletes, the Olympic Gold medalist Mo Farah is helping to raise awareness about the issues people in the developing world will face now that Barclay's Bank has withdrawn facilities for money transfer agencies. He is backing a campaign started by MP for Bethnal Green and Bow Rushanara Ali to save money transfer agencies that help to provide a lifeline to some of the poorest people in the world.

Barclays bank has withdrawn remittance accounts for money transfer companies due to money laundering scams and the difficulty in policing the movement of money from the UK overseas.  In May after a review of their current anti-money laundering policy Barclays found that 250 companies did not meet their current criteria. 80 of these companies are still active in the remittance sector and were given 60 days notice that Barclay's would no longer be providing facilities for them to operate.

Over 25,500 signatures were handed in to 10 Downing Street on a petition which included Mo Farah asking for money transfer agencies to be protected.

In Somalia Barclays was the last UK bank to provide money transfer services to the country where it is estimated around 40% of the population rely on money coming in from remittance firms. Oxfam have reported an estimated £3.2 billion has been sent in aid via agencies from the UK with £109 million transferred from the UK to Somalia.

If residents of the UK are no longer able to send money to the developing world using local remittance firms they will use alternative methods which will cost more meaning the most venerable are likely to receive much less financial help. 
Large remittance firms such a Western Union and MoneyGram have not been affected by Barclays policy review. They still offer money transfer facilities to countries such as Somalia but are far more expensive with hefty transaction fees of up to £20 and provide uncompetitive exchange rates.

People desperate to get money to their loved one overseas may use unregulated dangerous and alternative methods that could see them losing their cash.

A meeting has been held with the British Bankers Association, the UK's economic secretary Sajid Javid, the UKs financial regulators, representatives from a number of major high street banks and representatives from money service businesses to try and find a resolution and help to ensure the safe provision of remittance services going forward. A spokesperson has described the meeting as "very constructive" and a review is taking place to see how those affected by the changes can be supported.    

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