Financial Crime World

Improving the Remittance Market in The Gambia

Background

The remittance market in The Gambia is characterized by high costs, low financial inclusion, and limited digital services. This report outlines recommendations and action plans to address these issues.

Key Challenges

  • High costs of remittances
  • Low financial inclusion
  • Limited digital services

Recommendations

  1. Improve Regulatory Framework: Review and update regulations to facilitate the growth of digital remittances.
  2. Enhance Consumer Protection: Develop stronger financial consumer protection provisions that apply across all financial sectors and services.
  3. Increase Transparency: Improve transparency on FX margins and fees charged by service providers.
  4. Support MTOs and Digital Product Offerings: Support Mobile Transfer Operators (MTOs) to offer more competitive pricing and digital products.
  5. Streamline KYC Requirements: Review and update Know-Your-Customer (KYC) requirements to be proportionate to the risks and take account of identification realities in The Gambia.

Action Plans

The report outlines several action plans, including:

  1. Technical Assistance: Provide technical assistance to support the Central Bank of Gambia in improving data collection processes and reporting.
  2. Diaspora Surveys: Fund diaspora surveys to gather information on remittance sending practices and preferences.
  3. Diaspora Mapping Exercises: Conduct diaspora mapping exercises with a focus on remittance sending practices.
  4. Call for Proposals: Launch calls for proposals aimed at FinTechs, private sector players, and other stakeholders to provide solutions to expanding merchant uptake of digital ecosystems.
  5. Financial Education: Assist in the coordination and dissemination of financial education activities, especially in rural areas where IFAD already has a presence.

Timeline and Budget

The report suggests that some actions can be implemented within 1 year, while others may take up to 2 years or more. The budget for these actions ranges from less than $250k to over $1 million, depending on the specific activity.

Conclusion

This report provides a comprehensive set of recommendations and action plans to improve the remittance market in The Gambia, with a focus on increasing financial inclusion, transparency, and consumer protection.