Providers of electronic money transfer (EMT) services are witnessing a growth in their activities that is mainly driven by the banking and economic crises. Remittance inflows through these companies have increased as well as local transfers. Many NGOs which have become more active in recent years are paying salaries to their employees and financial assistance to beneficiaries mainly through EMT providers, so are some companies. A more favorable regulatory framework has also encouraged money transfer companies to offer digital solutions such as mobile wallets. EMT companies are providing faster and more convenient services than banks.
Rise in remittances and NGO disbursements
The banking and economic crises have contributed to the growth of both internal and external transfers via EMT companies. Expatriates, who are sending remittances to Lebanon as well as NGOs that have intensified their work due to the economic crisis, prefer to use EMT channels to avoid the risks involved in using the banking system. Before the crisis, cross-border money transfers as well as internal transfers were mostly channeled through the banking system. “The activities that have witnessed a growth recently include inbound money transfers, salary domiciliation, and wedding lists. Expats are sending more remittances to help their relatives in light of the economic crisis and also to pay taxes before the official exchange rate is raised,” said , Co-Founder and Chief Financial Officer (CFO) of Whish Money. Whish Money, formerly known as WOO Cash, is a money transfer company founded in 2019. “Domestic transfers have also increased due to rising transportation costs and the banking crisis. We don’t charge for local transfers in lira., CEO of CashUnited, international transfers through EMT companies have shifted towards more inflows which have surged significantly. CashUnited, which is owned by the Saradar Group, is the representative in Lebanon of MoneyGram, a USbased cross-border money transfer company. NGOs are performing almost all their payment transactions through EMT companies due to the banking crisis. , Chief Operating Officer (COO) at CashUnited, said that NGOs, which are engaged in many local projects, pay salaries mainly to Lebanese nationals and benefits mostly to Syrian and Palestinian refugees and few Lebanese households. She said that CashUnited enjoys the biggest chunk of the NGO payment business and that banks used to offer NGOs very competitive services through debit cards before the crisis. According to Abou Ghazaly, payments through online vouchers have also increased because these vouchers have been used extensively due to Covid-19.
