The banking giant says it is concerned that it does not where money transfers are going and who is sending the money. With little ability to track cash flows it is much easier for money launderers and the financing of terrorist activities.
“It is recognized that some money service businesses don’t have the proper checks in place to spot criminal activity and could unwittingly be facilitating money laundering and terrorist financing,” said Barclays spokesperson Daniel Hunger to IRIN.
Somalis living in and out of Somalia say that the plan will cut vital flows of money.
More money is sent to people in Somalia through remittances ($1.2 billion) that is provided in international aid (~$800 million). The sum of remittances accounts for roughly half of Somalia’s gross national income (GNI). Money set by family members living abroad helps to support the education of siblings and a parent’s business. Various vendors proliferated across Somalia as a result of the amount of money flowing both in and out of the country through person to person transfers.
It is not only people who benefit. NGOs and civil society organizations use cash transfer services to process cash disbursements and budgetary funds. British-Somali Olympic gold medal winner Mo Farah issued a call for Barclays to reverse its decision citing the impact it will have on Somalis and charities like his charity.
“The Mo Farah Foundation, along with some of the world’s biggest charities and organisations, including the UN, relies on these businesses to channel funds and pay local staff,” he said in late July. “This decision could mean life or death to millions of Somalis.”
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