By John Meyer, for Eurasia Business News – August 18, 2021
Western Union has announced that it has temporarily stopped money transfers to Afghanistan since August 16, MarketWatch reports.
“We understand that the services we provide allow our clients to support their loved ones. We will continue to closely monitor developments (in Afghanistan) and keep our clients informed of developments,” the press release said.
So far no information was released about the position of MoneyGram regarding the transfer of funds to Afghanistan.
Residents of Kabul and other major cities will be hardest hit by the temporary restriction made by Western Union.
In rural areas, the population predominantly uses the hawala money transfer system, which is traditional for the countries of Central Asia and in the Middle East. This system is an informal money transfer through the services of brokers by offset or in person.
Remittances from abroad in 2020 amounted to 4% of Afghanistan’s GDP or $ 788.9 million, according to the World Bank. Then the GDP of Afghanistan was at the level of $ 19.8 billion.
Remittances are sent from migrant workers to their families in their home countries.
The Western Union’s 2021 second quarter revenue of $1.3 billion increased 16% on a reported basis, or 13% constant currency, compared to the prior year period.
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