Fees for remittance: MPs, CBB hold different views

MPs recently discussed with the government an urgent proposal to impose fees on remittance services.

Despite the rejection of the Central Bank of Bahrain (CBB) and Finance Ministry, Financial and Economic Affairs Parliamentary Committee approved the proposal.

The presenters of the proposal were MPs Mohammed Al Ahmed, Nabeel Al Balooshi, Mohammed Al Maarifi, Isa Turki and Anas Buhindi.

They explained that small amounts of money should be deducted from each remittance process, adding that this step will form a new source of income to the country and contribute in the economic development of Bahrain.

In its reply to the proposal, CBB didn’t support the idea as they claimed that “it would harm the economy and negatively impact the banking and commercial sectors.”

“This contradicts with the policy of Bahrain which is based on free economy without administrative fees or imposing restrictions,” CBB said.

The bank also stressed that Bahrain is considered a regional financial centre and hosts many foreign banks that mainly depend on the leniency of money transferring procedures in the country, adding that “if imposed, this new system would drive these establishments away and deprive Bahrain of attracting new foreign ones.”

It also pointed out, “Imposing charges on remittance would have a bad impact on the foreign employment in the Kingdom and might create new illegal channels to transfer funds abroad. It also contradicts with the development of non-oil income sources that is followed by the government.”

The proposal will be reviewed by the remaining MPs on Tuesday and the matter would be discussed further.

MP Al Ahmed told DT News earlier that “the proposal will benefit national economy, without affecting the livelihoods of expats working in Bahrain,” adding that “statistics showed that BD2.5 billion is the amount of money transferred abroad from the Kingdom.”