DAMMAM, 17 August 2003 — Business is normal at banks as far as money transfers by expatriates are concerned. An Arabic daily had earlier quoted Saudi Arabian Monetary Agency (SAMA) sources that commercial banks in the Kingdom had been asked to transfer cash from account holders only.
According to the new regulations, Al-Eqtisadiah said, banks are allowed to provide money transfer services and sell travelers checks only to their clients, whether they are companies, individuals, Saudis or expatriates.
However, a random survey of banks in Dammam and Alkhobar by Arab News has revealed that business was as usual and expatriates were still transferring money to their homes without any problems.
An official at the Al-Rajhi Banking and Investment Corporation also confirmed that there had been no changes in the rule and that anyone, account holder or not, could transfer money to the destination or account of his choice.
There are nearly 7 million expatriates in the country who transfer an estimated SR21 billion every year. Some 65 percent of these expatriates are people who do not have a bank account in the Kingdom.
Banking sources say that they are not ruling out new regulations about money transfers from the Kingdom in order to curb money laundering.
“There have to be some check and balances in money transfers,” said a Bahraini banker. However, this becomes a very tricky issue as the Kingdom strictly adheres to a free market policy and has never imposed any kind of restrictions on expatriates and money transfers. There is no denying the fact that many banks as well as money exchanges thrived because of money transfers.
In recent years, institutions such as Saudi American Bank’s SpeedCash and Western Union Money Transfer have done a roaring business in transferring money. Both these facilities are for money transfer only and at both, customers are required to furnish personal details and copies of Iqamas or national IDs. At other money exchanges and banks, there is no requirement except that the sender must provide his address and ID number.
The expatriate community in the Eastern Province is concerned about the report and say that if such regulations are enforced, hundreds and thousands of expatriate workers and their families will suffer immensely. They say that expats are already victims of varying exchange rates and they urged SAMA to regulate exchange rates in the banks and make them uniform throughout the Kingdom. There have been past reports that sometimes different branches of the same bank offer different exchange rates on the same day for the same Asian currency.
Among the national banks, the rates for different currencies differ, with the exception of the American dollar, whose selling rate is normally uniform though the buying rate differs from bank to bank.
Expatriates say that these variations mean losses for them and urged the authorities to regulate the exchange rate.
Meanwhile, Al-Eqtisadiah quotes high-level sources that “Receiving cash is restricted to personal deposits of account holders and the payment of utility bills.”
The new rule prevents local banks from accepting orders to purchase financial papers, including shares from investors except through client accounts. However, the purchase of travelers’ checks from pilgrims has been exempted from the rule.
