MoneyGram to Comply with Yemen's New International Transfer Restrictions

MoneyGram has announced its commitment to adhere to the Central Bank of Yemen's (CBY) recent decree restricting international money transfers to approved banks and exchange companies, effective June 4, 2024.

The CBY's decision, formalized in decree no. 20 of 2024, was confirmed by Governor Ahmed Ghalib. The decree aims to ensure that the banking system operates independently and in compliance with CBY monitoring and national laws.

Governor Ghalib emphasized that the decision is a sovereign one, made without influence from national, regional, or international parties. He stated that the CBY is moving forward with implementing the decision as planned.

Why this matters: This decision has broader implications for the stability of Yemen's banking sector and its economy as a whole. The restriction on international money transfers could have significant consequences for the country's financial system and its citizens.

The CBY's decision comes in response to the disruptive actions of the Houthi militias, which have been accused of politicizing the banking sector, violating laws, and creating economic stagnation in areas under their control. The militias have also been implicated in freezing and confiscating citizens' accounts and minting counterfeit currency.

In a press conference held on May 31, 2024, in Aden, Governor Ghalib reassured depositors that their funds are guaranteed by the CBY and that banks will continue to operate in government-held regions. He warned against exploiting the decision to settle scores with affected banks, which have not committed any crimes related to money laundering or terrorism financing.

The Presidential Leadership Council (PLC) of Yemen, chaired by Dr. Rashad Mohammed Al Alimi, held an extraordinary meeting to discuss the country's economic situation. The PLC expressed full support for the CBY's decision, emphasizing the need to protect the banking system, eliminate monetary distortions, and control inflation.

The PLC reiterated its commitment to fulfilling its obligations, including regular salary payments for government employees and improving public revenues. The council also addressed the impact of the Houthi militias' attacks on oil installations and international shipping lines, which have exacerbated human suffering.

The CBY has taken steps to ensure that the banking system operates within the legal framework, relocating its headquarters to Aden in mid-2016. The CBY is the sole authority supervising and controlling banking in Yemen, working in coordination with the international community and specialized financial institutions.

With the June 4, 2024 deadline approaching, MoneyGram's compliance with the CBY's decree highlights the importance of international cooperation in stabilizing Yemen's banking sector. The move is expected to enhance transparency and accountability in financial transactions, contributing to the country's economic recovery.

Key Takeaways

• MoneyGram to comply with Central Bank of Yemen's decree restricting international money transfers.
• Decree aims to ensure banking system operates independently and in compliance with national laws.
• Restriction targets Houthi militias' disruptive actions, including politicizing banking sector.
• Decision has broader implications for Yemen's banking sector and economy.
• International cooperation crucial for stabilizing Yemen's banking sector and enhancing transparency.