Studying raising fees by a small percentage to cover the increase in operating costs.. and after the approval of the Central Bank

"Banking and money transfer": 8% expected growth in transfers during 2022

• The money transfer market in the UAE is one of the largest in the region.

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• Muhammad Al-Ansari: “Despite the provision of a strong technological structure related to financial transfers, the transfer through branches still has the largest share.”

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The Chairman of the Board of Directors of Exchange and Money Transfer Institutions in the UAE, Muhammad Al-Ansari, said that money transfers through exchange companies operating in the country witnessed during the current year a largely acceptable activity, given the global market situation, where it is expected, according to preliminary results, to record an annual growth of between between 5 and 8%.

Al-Ansari confirmed to "Emirates Today" that the exchange market has recovered to a large extent, with the support of the opening of all economic activities and the abolition of restrictions and other matters that accompanied the spread of the "Corona" pandemic.

He said that despite the provision of a strong technological structure related to money transfers through smart applications and "online", the demand for transfers through branches still has the largest share, as the cost of operational operations increases annually by a rate ranging from 5 to 10%, so we are currently studying an increase in fees. Transfer by a small percentage, maybe a dirham or two, starting from the first quarter of next year and after the approval of the Central Bank.

Al-Ansari explained that this percentage will not affect customers because the current transfer fees are among the lowest rates in the world and range between 10 and 15 dirhams, in addition to that there are strong and strict requirements by the Central Bank that also raise the operating cost, so the study of increasing fees came to balance command.

And he indicated that about 50% of exchange companies exited the market during the past three years for several reasons, including the Central Bank’s requirements related to capital, auditing, transparency, and anti-money laundering controls, in addition to the fact that these companies were small from their inception and had only one or two branches. Therefore, it could not continue due to the accumulated losses.

Al-Ansari expected the exit of a number of other exchange companies due to their inability to meet the requirements of the Central Bank or manage their operational operations in a way to avoid loss, pointing out that the “Central” imposes strong penalties on companies that violate anti-money laundering requirements in a way that guarantees a good reputation for exchange companies and reflects positively on Integrity of companies operating in the market.

Al-Ansari said that the remittance market in the UAE is one of the largest markets in the region, as the country is a well-known regional financial center, indicating that it is natural for there to be strong controls that maintain the reputation of the financial sector and ensure the integrity of companies operating in it.

• 50% of exchange companies exited the market during the past three years, but they are ineffective.

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