FERG, which stands for the group of banking and financial transfer institutions, made an announcement that the recognized exchange businesses in the United Arab Emirates have gained the necessary permits to apply an optional update to the costs. This amendment will allow the companies to boost the fees by at least 15%, which is equivalent to AED 2.5.
As a result of developments in local and global regulatory requirements as well as cost increases that have occurred since the last fee adjustment, this is the first fee adjustment that has occurred in the first five years.
Modifying fees for branches only
In light of the increased reliance on digital services and the performance of numerous tasks without reference to branches, the fee adjustment will only apply to branches. On the other hand, the fees for transfers made through the applications of exchange and money transfer businesses will either remain the same or may be decreased.
A significant contribution was made by the Banking and Remittance Group in the process of performing thorough market research and cooperating with regulatory authorities in order to make this important endeavor possible.
This permission comes after a thorough analysis of the costs that are connected with maintaining the highest possible standards of service and complying with the specifications set out by regulatory agencies. The decision was made with the intention of guaranteeing that exchange businesses will continue to be competitive in spite of rising prices.
Average cost of money transfers
Even though there has been a modest increase in fees, it is anticipated that the average cost of money transfers will continue to be approximately 3.5%, which is significantly lower than the average cost across the world.
According to the most recent surveys conducted by the World Bank, the average cost of transporting the equivalent of two hundred dollars over the world is 6.2%.
The United Nations Sustainable Development Goals continue to include adjusted remittance fees. These goals have the objective of removing remittance corridors that have prices that are greater than 5% by the year 2030.
According to Mohammed Ali Al Ansari, Chairman of the Banking and Financial Transfer Institutions Group, "We commend the decision to allow exchange companies to adjust their fees on money transfers. This step is of great importance in enabling companies to adapt to changing factors in the sector. Additionally, the decision enables exchange companies to move forward in providing high-quality services, meet changing regulatory requirements, and adapt to operational costs that have been maintained without any increase in fees over the past five years." A statement was made by Mohammed Ali Al Ansari.
Through its members, the consortium of financial transfer and banking institutions reaffirms its commitment to delivering additional value and ensuring the satisfaction of its clientele.
The purpose of amending fees
This charge adjustment is created with the intention of ensuring that fee changes are in line with the affordability of the customer, so assuring a conversion experience that is not only secure but also inexpensive.