More than 50 banking, finance, economics and political and security experts from the Middle East gathered in Sharm el-Sheikh, Egypt, in September 2015 for a Union of Arab Banks conference on financial inclusion. The conference focused on the positive impacts of bringing more people and firms into the formal financial sector, including combating money laundering and terrorist financing.
On the topic of anti-money laundering and countering terrorist financing, Secretary-General of the Union of Arab Banks Wissam Fattouh said Arab banking leaders recognize that a large database is needed to monitor the movement of money. However, a major obstacle is that many Arab citizens do not deal with banks, Al-Monitor reported.
A financial database is crucial as a security measure against illegal activities, especially money laundering and terrorism. So Egyptian authorities are seeking to introduce people living in Egypt to the formal banking system.
A recent International Monetary Fund study cited reasons for “nonfinancial inclusion” in Arab countries. These barriers included poverty, high bank fees, the sharing of a single bank account for a family, complex paperwork required to open an account and the great distances in some communities between homes and banks. Religious beliefs also influence a person’s willingness to work with a conventional bank that uses interest-bearing instruments.
An Egyptian banker at the conference told Al-Monitor that governments of Arab countries are trying to address these challenges. Some are establishing new policies aimed at overcoming obstacles that prevent people in the region from opening bank accounts and thus, facilitating citizen integration into a system that would be more capable of monitoring financial transactions and confronting illegal activity.
U.S. Treasury Attache to Egypt Celine Senseney gave a speech at the conference on the role of the United States and other international partners in helping countries in the Middle East and North Africa deepen financial access and formalization.