Hundreds of global remittance
companies forced to cease transfers while Western Union, Money Gram and Ria
continue
August 2,
2016 — WorldRemit (www.WorldRemit.com), a leading online remittance provider,
is calling for the urgent restoration of money transfers to Nigeria as
draconian new rules leave virtually all money transfer operators (MTOs) unable
to provide services to the West African country.
Only three companies – Western
Union, MoneyGram and Ria – will be able to continue operations, following an
extreme and unexpected move by the Central Bank of Nigeria.
WorldRemit, in common with all other
international MTOs, has been instructed by its local correspondents that
transfers to Nigeria will no longer be processed and is, accordingly,
suspending services immediately.
WorldRemit founder and CEO, Ismail
Ahmed said: “This move is arbitrary, inexplicable and hugely detrimental to the
Nigerian diaspora who rely on hundreds of money transfer companies and banks,
providing them with choice, convenience and competitive pricing.
“Even now, as we suspend our
service, there is no clarity on why this sudden change has happened. If it is
on the basis of new rules, there was no warning. If it is a re-interpretation
of old rules, local correspondent networks and banks should have been
forewarned.
“This reverses the progress made by
the country when the Nigeria Central Bank banned Western Union’s exclusivity
agreements (http://APO.af/aicftV) that had created a near-monopolistic position
in the international money transfer market. Western Union controlled 78% of the
market share when CBN outlawed exclusivity agreements with local banks.”
Until now, money transfer operators
such as WorldRemit operated via partnerships with licensed local correspondents
in Nigeria, enabling transfer of funds to local bank accounts – providing a more
efficient service than the SWIFT infrastructure.
WorldRemit has also raised concerns
about a 2015 memorandum (http://APO.af/sY6hdl) from the Central Bank of
Nigeria, setting out minimum requirements for companies offering international
Mobile Money transfer services to Nigeria.
The guidelines specify that any
company offering Mobile Money transfers must have minimum net assets of $1bn
and have been operating for more than 10 years.
WorldRemit is the world leader in
transfers to Mobile Money accounts and had been planning to launch remittances
to Mobile Money services in Nigeria.
“It looks like all systems in
Nigeria are currently geared against encouraging new entrants and competition
in the mobile remittance markets. That is worrying in the extreme,” said Ismail
Ahmed.
World Remit sends more than 40,000
money transfers to Nigeria every month.
Nigeria received more than $20bn in
remittances annual from migrants around the world.
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