• Challenges to sending money back home

Challenges to sending money back home

This report examines existing information on the UK remittance industry, and synthesises good practices, data and emerging innovations relevant to remittances from the UK to developing countries.

The paper finds that:

• information on the market size, market economics, lessons from other corridors and customer preferences/behaviour is needed by the industry to realise the potential of the market, and by the Government and regulators of the sector to underpin future policy development and regulatory actions of the remittances market
• potential misinterpretation of the requirements for remitting money results in inconvenience to the customer, representing a potential barrier to access or an inadequate management of the money laundering/terrorist financing risk.

Main recommendations for the Working Group Committee, in liaison with others include:

• review whether existing good practice guidance and training material meets the needs of remittance providers, and exchange good practice on guidance material relevant to each sector
• stimulate the production of new guidance and training material as necessary
• find ways of encouraging firms to act in accordance with agreed good practice
• consider whether the industry’s perceptions about coordination of regulation and the desirability of a single regulator are well founded
• support the nascent Money Transmitters’ Association and encourage small money transfer organisations (MTOs) to join. This will enable the government to understand better the impediments to flows in these country corridors and so work to remove them
• analyse and verify comparative evidence, and work with private sector participants on developing recommendations as to how to encourage the entry of migrants into that system
• explore the costs and benefits of establishing guidelines for a code of conduct or quality mark for remittance providers which would enable consumers to choose products on a basis other than perceived security
• examine ways to help firms meet their legal requirements and the needs of their customers.

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