UAE will begin making a lawful move against non-enlisted Hawala agents when the enrollment cutoff time lapses on December 2, 2020, post which unregistered Hawala service providers will not be permitted to work in the UAE.
As per the reports, there will be supervisory measures and necessary legal actions post the December 2nd deadline. This would include penalties, fines and even the closure of the office premises.
Hawala, is a process in which monetary value is transferred to individuals in other countries. This is mostly used in remote places of those countries, which do not have access to banking services. Hawala is used today as an alternative remittance channel that exists outside of traditional banking systems. The Hawala system is heavily based on trust between the parties involved.
According to the new rules, enlistment is compulsory for Hawala service providers, or informal cash transfer agents working in the UAE, to regularize their status before December 2, 2020.
Regularizing Hawala is a significant component to keep up the transparency of exchange of funds, and to improve the reporting standards according to the worldwide principles, particularly concerning Anti-Money Laundering and Combating Terrorist Financing (AML/CFT).
