The National Bank of Ethiopia (NBE) has launched a coordinated crackdown on unlicensed money transfer operators to bring remittance flows back into the formal banking system. This effort aims to stabilize the volatile Ethiopian currency (the birr), curb underground money transfers, and strengthen the country's foreign-exchange reserves. Nearly 78% of cross-border remittances currently pass through informal channels like hawala, causing significant losses in foreign currency inflows. The NBE is pursuing legal action against unlicensed operators and has published a list of licensed firms to warn citizens. This crackdown is part of broader reforms under the new central bank governor Eyob Tekalign to enhance financial regulation and economic stability. The success of these measures depends on whether formal remittance channels can compete effectively with informal networks in terms of convenience and exchange rates. Ethiopia's efforts are similar to other African countries tightening controls on diaspora remittances to combat money laundering and support the national economy.
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