US Banks Shun Money Transmittal
U.S. banks are keeping their distance from money transmitters sending cash to Mexico, as worries about money laundering and increased regulatory scrutiny ensue.
According to a report in The New York Times, while Mexico is the largest destination for money transfers from the U.S., banks no longer view it as an opportunity. That’s even with The New York Times, citing the World Bank, reporting around $24.3 billion was sent from the U.S. in 2017, accounting for almost all the cross-border money that came into Mexico from around the world. But it’s not only money transmitters who are suffering from the moves on the part of the banks. The New York Times reported mom-and-pop convenience stores are feeling the pain. It also means limited options for those living in the U.S. who want to send cash home. They may be forced to do it by sending cash in the mail, which could be risky. The paper, citing the Conference of State Bank Supervisors, noted that more than a quarter of U.S. households rely on nonbank financial institutions, including money transmitters, for their banking needs. “Large banks are just walking away from the business completely,” Peter Ohser, an executive vice president of MoneyGram International, told the NYT in the report.