A new announcement from the Central Bank of the UAE (CBUAE) has made registration mandatory for Hawala or informal money transfer service providers in the UAE. The new Hawala registration system follows the Registered Hawala Providers Regulations. It is an effort by the central authority to improve the country’s financial security.
Hawaladars constitute an informal non-bank settlement method to enable the transfer of funds between individuals. Now, the mandatory registration will give Hawaladars a formal status as a legitimate channel of remittance.
With the new regulations, Hawaladars are now legally required to register with the CBUAE and all their activities will be monitored and scrutinized as per UAE’s AML/CFT regulations. CBUAE requires all currently operational Hawaladars to register with it within 90 days of its announcement. Failure to comply could invite financial penalty and even imprisonment.