Minneapolis mayor urges feds to help Somali-Americans send money back home

Author:
Updated:
Original:

Minneapolis Mayor Betsy Hodges joined mayors from around the country Monday in calling for a federal solution to help Somalis living in the U.S. more easily send money to relatives and friends in their homeland.

Many Somalis in America use money transfer operators to send funds, called remittances, back home. Somalia, which has been in the throes of civil unrest for years, has no functioning banking system of its own, and the remittance system is one of the only ways for money to be sent to residents there.

In recent years, U.S. banking operations have shut down their money transfer operators because of stricter federal regulations designed to prevent the money from getting to terrorist groups instead.

The latest bank to do so was Merchants Bank of California. It handled between 60 percent and 80 percent of all U.S. transfers to Somalia, according to the International Business Times.

It closed down its accounts in February, leaving thousands of Somali families in dire straits.

In a news release, Hodges said she and Seattle Mayor Ed Murray sponsored a resolution that was adopted Monday by the U.S. Conference of Mayors, urging the Obama administration to develop a system that would restore the "normal flow of remittances to Somalia without compromising the safety and security of the United States."

Minneapolis and Seattle are home to the largest and second-largest Somali immigrant communities in the United States, according to Hodges.

“Their ability to send money home provides loved ones in Somalia with a critical lifeline that we must protect," she added.

Minnesota's political leaders have been pressing the federal government for months for a solution. Sens. Al Franken and Amy Klobuchar, as well as Rep. Keith Ellison, met with federal officials in late February to discuss the issue, to no end.

Some 40 percent of the families in Somalia – more than two million people – depend on remittances from overseas to help pay for food, water, shelter and education, the Guardian reports.

Somalia receives approximately $1.3 billion in remittances each year, which is the single largest sector of the country's economy, according to Oxfam America.

Banks in the United Kingdom and Australia also shut down their money transfer operations in recent months, the Guardian notes.

Is plastic a solution?

One of the world's largest credit card vendors, MasterCard, recently announced it will move into the Somali market by offering debit cards to Somali citizens to help them receive money from abroad, according to the International Business Times.

Right now most of the remittances are distributed in cash by money changers. Using prepaid cards or debit cards would help ensure the funds go to their intended recipients.

The Times notes, though, that Somalia might not yet have an infrastructure that's reliable enough to support the use of cards on a wide scale.

Next Up

Ian Cole

Wild trade Greg Pateryn to Avalanche for Ian Cole

Cole won a pair of Stanley Cups in Pittsburgh and is a former first-round pick.

1024px-Hudson,_Wisconsin_9

St. Croix County GOP chair resigns after incendiary post on official website

John Kraft sparked controversy with his 'Prepare for War' post on the party website earlier this month.

ann kim

Ann Kim's new restaurant, Sooki & Mimi, to open in February

The James Beard Award winner is the brains behind Young Joni, Pizzeria Lola, and Hello Pizza.

Screen Shot 2021-01-19 at 1.32.19 PM

Firefighters rescue worker after trench fall in Rochester

The construction worker fell about 15 feet.

gray wolf

Grand Marais mayor's dog survives attack by wolves

He heard his 65-pound dog "screaming bloody murder" and then saw the wolves chasing her.

Screen Shot 2021-01-19 at 12.04.55 PM

Minnesota's COVID vaccine appointment site goes live

Huge demand was expected when the site went live at noon.

emily ford

Duluth woman is hiking 1,000-plus miles on the Ice Age Trail this winter

She could be the second person ever to finish a winter-thru hike of the Wisconsin trail.

coronavirus, covid-19, icu

Here is Minnesota's COVID-19 update for Tuesday, January 19

Two days in a row with fewer than 1,000 new cases.

Screen Shot 2021-01-19 at 10.52.12 AM

After fire destroyed their house, couple forced to euthanize beloved dog

The couple's daughter has launched a fundraiser for her parents.

Screen Shot 2021-01-19 at 10.16.14 AM

Investigation after teacher accused of lewd act during distance learning

No charges have been filed yet and the staff member has not been identified.

Related