On 27 June 2016, Barclays announced it would be closing the accounts of 250 UK accounts held by money-transfer companies who deliver remittances to families in developing countries, due to concerns regarding a lack of adequate controls. Rushanara Ali MP has since been leading the Save Remittance Giving Campaign calling on Barclays to reverse its decision and the Government to throw a lifeline to families in developing countries by co-ordinating action between government and financial regulators to secure a long-term solution.
Millions of families in the developing world rely on remittances to pay for basic necessities such as food and healthcare. The World Bank reported that official records of remittances to developing countries in the Indian Sub-Continent and Africa as well as other parts of the world amounted to $530billion in 2012, and around $3.2billion from the UK in 2011.
Somalia, one of the poorest countries in the world, which is trying to re-build following years of conflict and one of the worst humanitarian disasters in 2011 which claimed 260,000 Somali lives, will be particularly hard hit. In a country where banking facilities have collapsed, remittances and money transfer agencies are an essential lifeline. According to Oxfam, an estimated $162million is annually sent to Somalia by the UK Somali diaspora community.
On 14th July 2013, 47 Labour MPs wrote a joint letter to Barclays urging them to consider delaying the account closures for an extended period of at least 6 months, while alternative solutions could be sought.
Rushanara later secured a Westminster Hall debate on this issue on 17th July 2013, the full transcript of which you can read here. The debate was very well attended by Labour MPs.
Some money-transfer companies have been granted an extension on their accounts by Barclays until mid-September and others until the end of September. Unfortunately, many others have already lost their facilities with Barclays.
On 7th August 2013, Rushanara Ali MP delivered a petition backed by double Olympic Gold medallist, Mo Farah, with 25,500 signatures to 10 Downing Street, calling on the Prime Minister to throw a lifeline to families in developing countries by taking urgent action on this issue. Rushanara was accompanied by Stephen Timms MP and Seema Malhotra MP, three Chief Executives of Money Transfer Agencies whose businesses are at risk, and three campaigners who have led the way in raising public awareness on this issue.
The campaign has to keep going to make sure a longer-term solution is provided by regulators and the Government. As it stands, the Government has initiated plans to set up a Safer Corridor pilot scheme to get remittances into Somalia safely and securely. However these plans have yet to be finalised.