Suspend Remittance Charges for Philippines Typhoon Recovery

o_keeley_tigra_500x279New Orleans   There was a front page story in the Wall Street Journal about the fact that more and more of the remittance business from banks and money transfer organizations like Western Union and MoneyGram is between countries in Latin America rather than from US and Canadian immigrants to Latin America.  Western Union in 10 years has seen US-based transfers drop from more than half of its business to only 30% of the $79 billion it moves.

            What I have not seen, that I should have seen, and correct me if I’m wrong, so ACORN International will know and Google can get right, is any indication that Western Union, MoneyGram or any major US-based bank has suspended remittance fees for immigrant families and relatives in the US who are trying to send desperately need money to the Philippines in the wake of the terrible typhoon disaster the country is experiencing.   I heard from Judy Duncan of ACORN Canada yesterday where our Remittance Justice Campaign is a major emphasis, that some banks had announced that they were suspending fees temporarily to help out.   In the US, we may be reading about a $13 billion dollar JPMorgan Chase settlements, but we are not reading about banks or MTOs stepping up in this huge Katrina-level disaster.

            And, in the Philippines this matters even more than in most countries.   Some of the best remittance policies in the world exist in the Philippines, because, like it or not, exporting labor is a linchpin in their national economy, so before issuing a work visa overseas, the government instructs traveling workers in how to handle transfers at the lowest possible cost.  With workers all over the globe, and all over the US in hospitals and other occupations, a suspension of remittance fees during this crisis even for a couple of weeks could mean many more millions that could go to direct relief, family-to-family, person-to-person.

            ACORN International is calling on banks and MTOs in the US to immediately suspend remittance fees so that money can move immediately to families in perilous circumstances desperate for aid from their families.   This is the season for Thanksgiving and Christmas.   Rather than just bowing our heads, let’s stand up straight and demand that banks, Western Union, and the rest do right and do it right now.

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Remittance Rip-offs

NRemittancesew Orleans Remittances are a huge part of the Gross National Product (GNP) of many countries around the developing world.  In fact some countries like Mexico, the Philippines, and others seem to be surviving largely because they are exporting workers who are sending back money to support families.  Remittances are the life blood and often the life line for migrant workers and immigrant families when globalism is often characterized by economic refugees.

Remittances are also a free fire zone for predatory pricing and practices.

ACORN International is in the last stages of pulling together a dynamite report on remittances between the developed world and the countries where we work thanks to our ace Toronto based intern army and voluntary researchers in Baltimore, Little Rock, and the countries where we organize.  Seeing the pieces come together what is amazing is the size of the total pie and the huge slice that sticks to the financiers!

Even in the recession the numbers are huge.  The World Bank estimates that the total level of remittances between countries is around $443 Billion USD, which is a breathtaking amount of money, and likely understated because it may not reflect fully the level of informal transfers and gifts between families.  The World Bank also estimates that the “average” cost of remittances – stay tuned for our report in the next two weeks on this! – is about 10%.  The math is easy to follow and it puts the transaction cost for remittances to the bankers and transfer companies like MoneyGram and Western Union at over $44 Billion USD!

This is obviously a blatant teaser for the upcoming ACORN International report and its release before Christmas when remittances spike upwards, but mentally start making a list of the differences 30 or 40 billion USD might make in poverty reduction and community development for lower income families if they were allowed to see more of the money in their hands as opposed to fleeced along the way.

It ought to be a crime!  We will look as well at why it’s not only not a crime but instead such predation is allowed to be practiced with impunity in an anarchy of no regulation or questionable regulation and ignorance in many countries.

Think about it.

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