DE-RISKING AND FINANCIAL ACCESS ROUNDTABLE

DE-RISKING AND FINANCIAL ACCESS ROUNDTABLE

The roundtable on de-risking and financial access was led by Humanitarian Policy Group at The Overseas Development Institute (ODI), The Humanitarian Forum and The London School of Economics, and supported by Islamic Relief Worldwide, Al Rayan Bank, Human Appeal, Al Khair Foundation, Human Security Collective and Charity & Security Network. It was held to address impact of de-risking on humanitarian organisations. 

The roundtable consisted of three 90-minute sessions. They explored:

  1. bank de-risking compliance regulations in Europe and the US and available channels (if any) for legal recourse
  2. implications of bank de-risking on humanitarian organizations and their coping strategies and
  3. how to avoid the adverse effects of de-risking while not increasing vulnerability to financial crime and terrorism

Key points of the session included:

  • Problem of de-risking, the regulations and the problems facing the non-profit sector were highlighted. Risk profiling and illegal routes for countries, sectors and individuals that had been de-risked were discussed.
  • During the session, three points were discussed to address de-risking: building banking capacity within organisations; consider transaction delays when designing programs, and how organisations should document delayed transactions to keep a record.
  • Organisations also discussed how de-risking was preventing them from fulfilling their duties to their beneficiaries.
  • Risk profiling and illegal routes for countries, sectors and individuals that had been de-risked were discussed
  • The consequences and impact of de-risking for Syria related humanitarian activities were explored
  • There was an opportunity for the Forum to influence what happened in other parts of the world because of the role of correspondent banking, and because of many donor funds coming from Europe, Australia and North America
  • Actors highlighted the ways NGOs could carve the way forward through engaging in lobbying and interaction with policy makers, local governments and financial sectors through awareness building of some of the challenges they faced.

Recommendations:

  1. Recommended ways to address de-risking included:
    1. building banking capacity within organisations;
    2. considering transaction delays when designing programmes, and
    3. ensuring organisations document delayed transactions to keep a record.
  2. A return to multilateralism, with the World Bank playing a role acting as guarantor for small to medium humanitarian organisations, adopting the risk they were not able to take.
  3. Central banks to be brought back into the conversation about banking.
  4. Bring the bankers, the regulators and non-profit organisations together to discuss where the problem really lay, and create a common understanding of the problem, as well as address solutions.

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