Joined by Angie Bray, local Acton MP, the Cities Minister held a roundtable discussion with a variety of representatives of the Somali community drawn from all over London. The conversations covered the wide range of experiences of people who use remittances to support their livelihoods by sending money back to friends and family in Somalia.
Problems have arisen where banks have withdrawn services to money service businesses (MSBs), as part of a more global trend of banks withdrawing accounts and other banking services to avoid a range of risks associated with international regulation and complication procedures for anti-money-laundering and countering the financing of terrorism (known as ‘de-risking’). The government has repeatedly stated its commitment to ensuring that UK consumers are able to send money safely and securely to their friends and family in developing countries.
On the back of the decision of some banks to close services to MSBs, the minister enquired about specific complications the community ran into, noting that the government has provided guidance on risk management to both MSBs and banks in order to help maintain confidence in their commercial dealings on remittances.
The Economic Secretary to the Treasury, Andrea Leadsom, said:
It has been vital to hear the experiences of this issue from the London Somali community first-hand, as remittances play a key role in supporting developing countries. The government is committed to ensuring that UK customers are able to access the financial services they need to keep remittances flowing, and today’s discussion will help us inform policy-making on this issue going forward.
The problem of banks withdrawing services is part of a global trend with global causes, affecting people across the world. The UK has been leading international efforts to prioritise work to address this issue, including through the G20 and global Financial Action Task Force. We have also taken substantial action at home to work through the particular challenges faced by money remitters, and we will continue our work to develop a ‘safer payment corridor’ pilot for remittances from the UK to Somalia.
Today (March 24 2015), the Economic Secretary is continuing her work to support customers affected by de-risking with a cross-sector meeting with MSBs, banks, charities and others, designed to root out common obstacles to service-provision.