De-risking by banks is making it difficult for nonprofits working internationally to send and receive money, causing projects to be delayed and even canceled, a new report has found.
The report by the Charity & Security Network finds that two-thirds of U.S. NGOs working abroad have experienced banking difficulties as a result of precautions around anti-money laundering and terror financing regulations, with 37 percent saying their wire transfers have been delayed and 33 percent saying fees have gone up. In addition, 6 percent of NGOs surveyed said their accounts have been closed, while 10 percent reported that banks have refused to open accounts for them.
These difficulties in accessing finance can have negative impacts on program delivery. The report includes examples of programs being canceled or delayed due to slow wire transfers. For example, in 2015, a charity was unable to pay for the fuel to power a hospital in Syria due to lengthy delays in transmitting funds.
About the author
Sophie Edwards
Sophie Edwards is a Devex Contributing Reporter covering global education, water and sanitation, and innovative financing, along with other topics. She has previously worked for NGOs, and the World Bank, and spent a number of years as a journalist for a regional newspaper in the U.K. She has a master's degree from the Institute of Development Studies and a bachelor's from Cambridge University.