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Once a month for years, Ahmed Ahmed has been going to Dahabshil, a money service agency catering to the Somali community outside Washington. The taxi driver has sent $200 every month to his family of eight left behind at home — until recently.
The service has been stopped, leaving Ahmed very worried.
“Forget the medicine or anything else,” he said. “The priority is food. If they don’t get the money, they don’t have food. They don’t have any jobs.”
After years of civil war and anarchy, there is no formal banking system in Somalia, so families overseas rely on informal money transfer networks known as hawalas to deliver cash to their needy relatives.
Merchants Bank of California was the last U.S. bank to handle wire transfers to Somalia. In early February, the bank announced that it would shut the service down. The reason most likely pertains to the U.S. fight to stop the flow of money that helps fund extremist groups in the region, such as al-Shabab.
Census data show that 80,000 Somali immigrants live in the U.S. A majority of them send money to their families in their impoverished homeland.
Osman Yusuf, manager of the Dahabshil money transfer agency, said the customers send about $200 to $300 on average. “We also have a lot of people who send $20, $30, $50,” he said.
In all, more than $215 million in U.S. remittances went to Somalia last year. Now, without cash transfers, Somali community leaders worry about the future for Somalia’s chlidren.
Farah Mohamed, a Somali community leader, and his group have been building a school with donations from Somali immigrants. “The school will definitely stop,” he said. “There is no way we can build a school or we can do anything. There are a huge number of Somali kids that are just growing up. Unless they get the right education, right assistance, we don’t know what their life will be.”
Some lawmakers and aid groups have raised concerns about the humanitarian consequences and have called for an emergency plan.
Scott Paul, a senior adviser at international aid group Oxfam America, noted that “there are communities of Somali refugees in Ethiopia and Kenya that have no other way of supporting themselves. If these companies [money transfer agencies] close down, those refugee camps and refugee communities are going to be in severely dire straits, maybe even worse off than people in Somalia.”
Congressman Keith Ellison, a Democrat from Minnesota, also said a disruption in remittances would cause greater security risks.
“When you know that al-Shabab and other recruiters will offer a young man a gun, a wife and a few bucks, it becomes clear how critical it is,” he said. “We must fix this remittance problem.”
The U.S. Treasury Department says officials recognize the importance that remittances play in Somalia and are working across the government to consider different options to address the issue.
But no solution has yet emerged. Somali immigrants are in fear for their loved ones.
“Really, really, I am worried about I cannot send money back home,” Ahmed said. “I don’t know what do.”
