Hawala
An informal value transfer system regulated in UAE for AML compliance.
Detailed Description
Hawala
What is hawala primarily used for?
Hawala is primarily used for transferring money, especially for remittances from expatriates to their families.
How does hawala differ from traditional banking?
Hawala differs from traditional banking in that it operates informally without extensive documentation and identification, allowing for quicker transactions.
What are the legal concerns associated with hawala?
Legal concerns include its potential use for money laundering and terrorist financing, leading to varying legal statuses across countries.
Who facilitates hawala transactions?
Hawala transactions are facilitated by brokers known as hawaladars, who operate based on trust and personal relationships.
What are the risks of using hawala?
Risks include potential fraud, lack of traceability for transactions, and disputes with no legal recourse.