A petition of 20,000 signatures, over a Barclays’ decision to block remittance services, goes to Downing Street… as Olympian Mo Farah also joins the cries of protest.
The petition, being delivered to No. 10 on Wednesday, opposes the decision by Barclays to close down bank accounts of remittance services.
It is the latest in an attempt to keep the money transfer system, which is a lifeline to millions of poor people in the developing world. Families and relatives here in the diaspora send money to their loved ones through these networks. It’s globally a multi-bilion industry.
Cutting this lifeline would be a disaster for millions. The small sums sent home by British Somalis each week enable family members to buy food, medicines and other life essentials. Mo Farah
However, Barclays is concerned that criminals and terrorists could use the existing system, and it has written to hundreds of remittance companies telling them their accounts will be closed.
Without British bank accounts these businesses won’t be able to operate legally. Most of the London-based banks have already stopped dealing with such firms and Barclays was the last one to do it.
Although, as we reported in June, Barclays has decided to extend the deadline for some companies, it has not changed its position.
Many communities in Africa and Asia will be affected by that decision. And there is no nation that relies on the service more than Somalia: it has no formal banking system.
Locally known as Hawalas, it is the fastest, most reliable and only legal means to channel money back home, and accounts for 60 per cent of annual income.
That is why Mo Farah, originally from Somalia, is the latest to throw his weight behind the movement. Speaking in London last week, the double Olympic champion spoke personally about the crucial role remittances have played for his family and his foundation.
“Cutting this lifeline would be a disaster for millions,” he said. “The small sums sent home by British Somalis each week enable family members to buy food, medicines and other life essentials.
“I have been sending money home for a number of years and the Mo Farah Foundation, along with some of the world’s biggest international charities and organisations, including the United Nations, rely on these businesses to channel funds and pay local staff.
“Everyone following the issue understands that Barclays has a bank to run, but this decision could mean life or death to millions of Somalis.”
It is so serious that some activists are even considering radical actions against Barclays such as boycotting. Others want African governments to warn Barclays, which has a huge presence in the continent, that their businesses there will be hit.
However, there are those who feel the British government should take full responsibility. In particular, relevant departments like the Financial Conduct Authority, a regulatory body, ought to do its job properly by distinguishing those companies who operate within the law from those who are thought to be breaking the rules.
Rushanara Ali, Labour MP for Bethnal Green and Bow and shadow international development minister, has taken the lead on the issue, and has mobilised fellow MPs from across all parties to debate the issue.
She asked Barclays to reconsider its decision: “We are calling on Barclays to provide some time and breathing room while the government and the regulatory agencies work out what action can be taken to save these businesses.”
This week the MP invited representatives of remittance companies, activists and other interested parties telling them that relevant government departments are now involved in trying to find a solution.
To consider the issue of remittances to Somalia, the Foreign Office convened a meeting, which was also attended, by the Home Office, the HMRC, the Serious Organised Crime Agency and the department for international development.
The UK authorities are particularly under pressure since David Cameron has publicly shown the desire for his government to help Somalia find a lasting peace after more than two decades of conflict.
Closing down an industry that is a lifeline for millions of poor people and is more important than aid is regarded as a tragedy that can be avoided.
In recent weeks, the Somali President Hassan Sheikh, prominent charities and more than hundred academics have all written to the UK government asking them to intervene.
Taking the petition to the British leader’s front door is part of the battle to reverse Barclay’s decision or at least find an alternative banking system.