Westpac to stop Somali money transfers on March 31

But Somali Remittance Action Group chairman Hussein Haraco said the closures would cut off the ability of thousands of poor, dependent Somalis to buy food and water and access health and education.

“Westpac has advised Somali and other money transfer operators that the closure is driven by increased perception of risk around remittance services in the context of changing international and domestic regulations and the bank’s own compliance requirements,” Dr Haraco said.

THOUSANDS of Somalis will be without money to buy food, water and medicine when Westpac severs ties with Australian money transfer agencies.

In a letter to a Bell Street Mall remittance provider, Westpac confirmed bank accounts would close after 4pm on March 31 and no further extensions would be given.

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Westpac is the last of the big four banks to stop services with remittance providers that kept the flow of money between Australia to the fragile African country open.

But the bank advised the remittance operators at the Bell St Mall it would close their accounts for good at the end of the month after a Federal Court hearing in December.

The letter said Westpac was no longer in a position to provide banking services to remittance companies.

“This is not a decision we have taken lightly and was made in the context of the changing international and domestic regulatory landscape and our own compliance requirements,” it said.

He said the impact of the account closures would be dramatic and would hamper the ability for Somalis to live.

Dr Haraco said while the Federal Government’s Remittance Working Group had made some progress, more time was needed to reach a viable alternative for remittances to Somalia.

“We welcome the fact that Westpac, via the Australian Banking Association, has been supporting efforts to reach a long-term solution to maintain remittance flows,” Dr Haraco said.

“However, closing the accounts of money transfer operators now, before that solution is found may undermine those efforts by sending the remittance industry underground where it cannot be policed.”

“In the absence of any practical alternative for Somali migrants to send funds home, we urge Westpac to defer their remittance account closure decisions by at least six months to allow time to the Remittance Working Group to find a viable long-term solution.”

Westpac didn’t respond to Leader’s request for comment.