The World Bank lists the United Kingdom as the top third remittance country in the world, after America and Canada. Its 3.8 million migrants routinely send over $20 billion USD (16bn) a year to their families and connections, although World Bank economists estimate the actual remittance flows to be far larger, since an unknown number of people bypass banks and big money-transfer companies. In 2016, the LTP report found that more than US$17 billion in remittance flows out of the UK to developing countries. These include Bangladesh, India, Kenya, Nigeria, Pakistan and Sri Lanka, as well as China, Lithuania, the Philippines and Poland.
On the whole, the British remittance system is known for its efficacy and ease, although British migrants complain about rates, and some express concerns about the security of their money.
The Department for International Development (DFID) is Britain's independent institution for boosting third world development. One of the ways it does this is by acknowledging the value of remittance in developing countries and by guaranteeing that its remittance channels to these countries remain protected.
In 2004, the DFID started a special division called the UK Remittances Working Group to simulate remittance flow to the developing emerging markets and to regulate security and protection of the funds. Its stated goals is: "To increase the value and frequency of remittances to the developing world and encourage these flows to reach wider groups of senders and receivers."
In that same year, the committee decided to liaison with the Joint Money Laundering Steering Group (JMLSG), Her Majesty's Revenue and Customs (HMRC) and the FSA to review existing guidelines, stimulate remittance flows and find ways to encourage firms to follow agreed guidelines.
In 2004, the UK Remittances Working Group introduced the Action Group on Cross Border Remittances to establish partnerships between stakeholders and international government, so the DFID could improve remittance transactions. Over the past few years, projects have included the British Government's Safer Corridor Initiative which aims to assure banks and money transference companies that their funds will be transferred safely and to help the Somali authorities in protecting their financial sector.
The DFID has also launched various guidance working groups tasked with guiding money-transferring companies on how to comply with British government anti-money laundering and terrorism financing regulations. These include the Joint Money Laundering Steering Group (JMLSG), which helps money transference companies identify crime risks, and the National Crime Agency, which investigated money laundering in the Money Service Business (MSB) sector.
Over the past two years, as realities of terrorism and money laundering have increased, the DFID has tightened its surveillance, keeping an ever closer eye on suspicious activities in the region. Some migrants see Brexit as a threat to their remittance transactions. The DFID along with the World Bank and the Bank for International Settlements have developed international standards for protection and fair trade.
Download Our Free App
Try our faster, enhanced mobile app for a better experience