Somali expats fear bank curbs on sending money home
By Mirjam Donath
NEW YORK (Reuters) - Each month, 42-year-old Abdirizak Alibos shows up at a money transfer business in the heart of Minneapolis to send $500 to his three children in war-torn Somalia.
"I send them money that they can pay for ... groceries, school fees, that they can buy health insurance, medication," said Alibos, who escaped to the United States seven years ago and now has a business driving people to medical appointments.
"I can say that 50 or 60 percent of my children's lifeline is remittance," he said.
But he and other Somali expatriates fear that they soon might not be able to give their families any more financial help. It is not money that they are about to run out of but the legal options for sending it home.
About 40 percent of all Somali families rely on remittances from another country, and the estimated annual total of $1.3 billion is more than all foreign aid and investment in Somalia combined, according to a study published last year by human aid organizations Adeso, Oxfam and the Inter-American Dialogue.
For more than two decades, the African nation of 10 million people has been a land of chaos because of divisive clan fights during its civil war and more-recent Islamist militant insurgents with links to al Qaeda.
Commercial banking disappeared in the early 1990s, and Western money transfer companies such as Western Union Co and MoneyGram International Inc do not serve most parts of Somalia.
This leaves the significantly cheaper and more informal money service businesses, or MSBs, to serve as intermediaries between the foreign banks that make the wire transfers and the intended recipients of the money. Continued...