Financial crime watchdogs and international policymakers have warned that de-risking is “severely” impacting countries that rely heavily on remittances to make up large portions of their GDP.
Jim Yong Kim, the president of the World Bank Group, told industry representatives last week that de-risking — where banks terminate relationships with money transfer businesses in an attempt to minimise their exposure to risk — is increasingly becoming a “source of stress” in developing jurisdictions.
In Somalia, de-risking policies are negatively affecting remittances, which comprise between approximately 25 and 45 percent of its GDP, according to Kim.
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