World Bank Working Papers 13 English; Paperback; 46 pages; 7x10
Published August 20, 2003 by World Bank
ISBN: 978-0-8213-5586-2; SKU: 15586
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The Money Exchange Dealers of Kabul is an exploratory piece
of research on how the informal financial sector operates in
conflict-afflicted countries. This paper presents the findings,
analyses and conclusions of a study on the operational characteristics
of an informal funds transfer system found in Afghanistan, generally
referred to as hawala. It describes the system's geographic
characteristics, convenience, effectiveness, cost, and its relationship
with the formal financial system. It studies the domestic transfer of
development funds by international aid institutions and nongovernmental
organizations and discusses the hawala system's benefits as well as
the operational characteristics that make it vulnerable to abuse.
Finally, it presents the authors conclusions on the developmental
role of informal financial institutions in the Afghan financial system;
the implications for financial management practices of donor-financed
development programs; and the regulatory and supervisory options for Da