Pardee-CFLP-Remittances-TF-Report

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Post-Conflict Development,” this volume). Mobile financial platforms are oftenessential for post-conflict communities as they enable the continuation of locallivelihoods amidst the breakdown of formal financial institutions and physicalinfrastructure (including roads, markets, and fixed-line telecommunicationnetworks).Issues of regulation and integration of mobile remittancesystemsSeveral recent studies on mobile remittances have suggested that m-bankingcan effectively contribute to the financial inclusion of the poor and marginal.M-banking provides convenient and secure financial services to those previouslyunbanked (Sultana 2009, 4), accommodating the requirements of a cash-basedeconomy and irregular income flows (Alampay 2010, 78). Branchless banking isless expensive as it is based on existing infrastructure and equipment, includingagent shops and mobile phones (Alampay 2010; McKay and Pickens 2010).Mobile remittances can contribute to development by reducing direct remittancecosts, increasing the geographical spread of distribution points, increasing thepercentage of remittances flowing through formal channels, and contributingto a broader inclusivity of poor populations to financial services (Porter 2009).Remittances could potentially be effective drivers for m-money usage as theyhave a well-defined and steady customer base and are relatively stable as comparedto other forms of investment (Alampay 2010).M-money allows a mobile phone subscriber to deposit value on their mobileaccount and send it to another individual (Alampay 2010: 77). Current m-moneyservices include transferring money between individuals domestically andinternationally, bill payments, repayments of loans of various microfinance andcredit arrangements, etc. The actors involved in m-banking can be diverse—some m-money applications are offered by banking institutions, some by telecommunicationproviders, and in many cases, there are partnerships betweenbanks and mobile communication companies (Aker and Mbiti 2010; Porteus2006). The two main models of mobile banking involve the “bank-based model”where every customer has a direct contractual relationship with a licensed andsupervised financial institution through a retail agent; and the “nonbank-basedmodel” where customer transfers or exchanges cash at a retail agent in returnfor an electronic record of value (Sultana 2009). The development of mobilemoney transfer systems therefore faces a fundamental challenge of facilitating acoherent policy and regulatory environment needed for a successful use of theRemittance Flows to Post-Conflict States: Perspectives on Human Security and Development 91
applications. That applies particularly to the convergence of communication andfinancial services that often involve separate regulatory authorities (OECD 2009).Some recent studies indicate a comparatively greater success of nonbank-basedmodels of mobile money applications. These include the initiatives of M-PESAin Kenya as well as G-Cash in the Philippines. M-PESA (m-money in Kiswahili)started as a service for the receipt and payment of microfinance loans throughthe Safaricom mobile network and since 2007 has successfully developed otherfunctions like remittance transfers, micro-insurance, school fees and bill payment(Mas and Morawczynki 2009; Sultana 2009). It allows cheap and rapidmoney transfers across Kenya, and the accounts can also be used for storingmoney. It has been estimated that more than 80 percent of those with mobilephones in Kenya use mobile money, and that annual mobile money transfer inKenya reaches 10 billion USD (Fengler 2012). M-PESA is viewed as a paymentservice provider rather than a formal bank by the regulating authorities andthe Central Bank of Kenya, and the service of payment transfer is listed in thetelecommunication services license agreement. It therefore falls legally undertelecommunication service. However, the primary regulator of mobile operators’m-banking services is the banking regulator. Money collected by agents isdeposited in a trust account in one of the leading commercial banks in Kenya,providing legal protection to the beneficiaries. It cannot be used for lending orinvestment by the mobile operator. Concerns over money laundering and customerprivacy have been further mitigated by regular monitoring by the CentralBank of Kenya and the Communication Commission of Kenya. M-PESA servicesare often credited for improving the circulation of money in Kenya as well asenhancing the transparency of money transfer operations. They have providedunique opportunities for integrating different forms of financial inclusion, includingmicrofinance, savings, and remittance transfer services.The G-Cash initiative in the Philippines is another success story of a nonbankledbranchless banking scheme. It was introduced in 2008 by Globe Telecomand functions as an electronic money transfer facility. It allows person-to-persontransfers, purchase of goods from merchants, and bill payments (Alampay 2010;Porter 2009; Sultana 2009). The G-Cash initiative similarly owes its success partlyto an enabling legislative framework and efficient safeguards. The General BankingLaw of 2000 allowed the recognition of microfinance as a legitimate bankingactivity, and the Electronic Commerce Act of 2000 helps regulate electronictransactions and provides necessary safeguards.92 A Pardee Center Task Force Report | October 2013
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Pardee Center TASK FORCE Report oct
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This series of papers, Pardee Cente
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AcknowledgementsThis Task Force on
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ITU International Telecommunication
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networks and migrant associations i
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to developing countries than other
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But most importantly, remittances a
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often mix in the countries of desti
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According to the World Bank estimat
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Because of its focus on the multidi
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eceiving remittances provides an en
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associations for post-conflict inst
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are proposed to avoid the associate
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Terry, D. 2005. Remittances as a De
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oader approach to post-conflict rem
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networks can be seen as “homogeno
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That personalized nature of hawala
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Customary law (xeer) and other trad
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the world (Lindley 2009, 531). Much
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ize the informal equal efforts to a
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struction and development. Means sh
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opportunities should focus on exist
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2. Dodd-Frank Act and Remittances t
Page 48 and 49: leadership. Formal payments systems
Page 50 and 51: and financial institutions. 26 Reso
Page 52 and 53: closures should be both in English
Page 54 and 55: issued a new proposed regulation De
Page 56 and 57: “closed network,” in which all
Page 58 and 59: Some guidance may be found in the p
Page 60 and 61: the use of mobile devices for money
Page 62 and 63: Foreign TaxesUnder the 2012 regulat
Page 64 and 65: will be available in all cases. CFP
Page 66 and 67: Section II: Remittances in Post-Con
Page 68 and 69: Sri Lanka. The conflict also result
Page 70 and 71: Figure 2: Current Account, Trade Ba
Page 72 and 73: flows came from migrant workers in
Page 74 and 75: Informal Remittance Channels in Sri
Page 76 and 77: tory authorities, with some calls f
Page 78 and 79: 4. The Role of Remittances in Post-
Page 80 and 81: Figure 1: Liberia Per Capita Income
Page 82 and 83: associations, women’s groups, alu
Page 84 and 85: Remittances to LiberiaValue of Remi
Page 86 and 87: credit because of the need to be li
Page 88 and 89: Remittance Transfers in Sierra Leon
Page 90 and 91: Knowledge RemittanceThe Liberian di
Page 92 and 93: process furthermore was a pioneerin
Page 94 and 95: Levitt, Peggy and Deepak Lamba-Niev
Page 96 and 97: Section III: Diaspora Networks andC
Page 100 and 101: One of the main challenges for mobi
Page 102 and 103: 6. Transnational Remittances and De
Page 104 and 105: The Salvadoran Diaspora is very sig
Page 106 and 107: annually during the 1990s to less t
Page 108 and 109: Figure 2: Transnational Vicious Cyc
Page 110 and 111: The transnational vicious cycle not
Page 112 and 113: emittance flows is mixed, as initia
Page 114 and 115: individuals, communities, and famil
Page 116 and 117: areas. This issue can potentially b
Page 118 and 119: This is a breakthrough moment: afte
Page 120 and 121: Edwards, Sebastian and I. Igal Mage
Page 122 and 123: y La Distribucion Del Ingreso, 1st
Page 124 and 125: 7. Remittances and Community Resili
Page 126 and 127: For quantitative data collection, a
Page 128 and 129: Remittances are perceived as playin
Page 130 and 131: the affected population. Internatio
Page 132 and 133: ReferencesAddleton, J. 1984. The im
Page 134 and 135: 8. Filling the Gap in Health Staffi
Page 136 and 137: The alternative is for donors to se
Page 138 and 139: cians in the U.S. in 2000 (Clemens
Page 141 and 142: 1. Remittances, Financial Inclusion
Page 143 and 144: networks, and communities. The role
Page 145 and 146: • In the present era of heightene
Page 147 and 148: the island of Kosrae, in the Federa
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and Sweden and has held visiting pr
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he organized a number of workshops
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