Moroccan Remittances Plummet as Transfer Fees Surge Amid Global Crisis

Addressing the issue of transfer costs, expert Iñigo Moré recalled that the health and economic crises have had a heavy impact on fund transfers, especially from Europe to countries that depend on them like Morocco. According to the specialist, transfers from Europe fell by 30% in March compared to February and will fall by more than 50% in April compared to the previous month. "From the two other foreign exchange providers, the Gulf and the USA, transfers have slightly decreased because these countries are at another stage of the unprecedented epidemic in the history of transfers. The main reason is due to a supply crisis, followed by a demand crisis," he clarified.

To justify the situation, he recalls that at the beginning of this same crisis, half of the fund departure points in Europe, more than 100,000, according to the European Banking Authority, were closed. Added to this is the problem of some large money transfer companies that have failed or are under the intervention of central banks. Faced with this situation, some money transfer companies have seized the opportunity to raise prices, especially for online services, the expert points out.

To curb this unprecedented crisis, Iñigo Moré advocates a strong reaction from the authorities to prevent the abusive increase in transfer prices and ensure fair competition between operators, which would prevent the emergence of dominant market shares. "It is possible to act on the exchange rate according to the different models of Pakistan or Bangladesh. The first has reduced the cost of transfers; the second offers a bonus exchange rate as social assistance in addition to strengthen formal remittances."

Continuing his development, he also argues that technology could help with the implementation of solutions based on the European electronic money directive, which could allow wallet-to-wallet transfers Europe-Morocco. "Transfers are strategic for Morocco. They are under the regulation of the authorities, both for sending and receiving. Coordination with the Banque de France, Banco de España or Banca d’Italia could be a solution to act on both the origin and the destination".