Dear Editor,
Western Union and MoneyGram [WU & MG] are the two main entities sending and receiving cash money around the world. The MoneyGram fee is US$4.50 to transfer up to US$50 and US$9.50 to send up to US$900. Western Union, in comparison, charges US$5 for a money transfer of up to US$50, but a transfer of US$900 could only cost US$76, but there are a number of price points in between, dependent on the amount of money to transfer i.e. for US$300 they would charge you a US$27 fee. If that was the end of the story then one would very easily see that it makes no sense sending money through Western Union, if MoneyGram was available; but it is not so easy. I sent 300 US to myself by Western Union and the received amount here was $60,651 and I sent the same 300 US to myself with MoneyGram and the received amount was $60,601, the transfer charge at Western Union to send US$300 from NY to Guyana for a US$300 transfer was US$27, whilst at MoneyGram the charges are supposed to be US$4.50. So how can the two end payments be nearly the same?
Well it turns out that Western Union exchanges US dollars for Guyana dollars at the rate of G$202.1675 to 1 US dollar, and since the receipt here in Guyana from MoneyGram and Western Union is nearly the same for 300 US dollars, G$60,051 MG and G$60,651 WU, it means that the advertising by MoneyGram to have a lower fee to make transfers is tosh, because they will convert at a lower rate and pay less than Western Union in actuality.
The last time I exchanged money at my Bank [Demerara Bank] the exchange rate they gave me was G$210 to US$1. It may not sound like much but if you are sending $1000 US to a family in Guyana and they changed it at my Bank, you would get G$210,000, but if someone sent you US$1000 by Western Union you would get G$202,167.5 or G$7,832.5 less than if you took the time to change it at my Bank, or I daresay any other commercial Bank or Cambio in Guyana. Needless to say I am not going to use Western Union again especially since if you take out five hundred United States dollars in one week, and need an additional 300 US, they are reluctant to effect the exchange since you are probably a money launderer or drug dealer??!! Yesterday morning I went to my insurance company to renew the insurance on my car for G$6000 and I had to waste several minutes filling out a form to show where I got the G$6000 to pay for the insurance premium. The young lady was most apologetic and told me that this was for the Central Bank and not the insurance company.
Now I am the first to agree that we must curb drug and other forms of trafficking and the accompanying laundering which goes with it, but which drug lord can get by laundering 700 US dollars a week? When controls begin to hamper business and interfere with the legitimate transactions of ordinary citizens, it is time to ask what the hell is going on? Because I am making something for my house here, I took US$300 on Wednesday and US$200 on Thursday but needed a further US$300 on Friday to pay the workmen and it was declined? When I made the order on Friday they told me that it is going to be reviewed and that I would hear from them in two hours. Editor this is my own money which I earned in the US and which I am sending to myself to repair something here in Guyana; two hours turned into 24 hours and it was then Saturday. My workmen are not speaking to me, and my options are now very limited because the Bank is closed, so in desperation I called WU and they put me through a long overseas call which lasted over an hour, and ended up with me speaking to their investigator who sounds like some Filipino man whose English I barely understood, and he wants to go through all my transactions for 2018. Well Editor you know what my answer to that was.
Western Union and Money Gram are charging fees to do these transactions as they are entitled to do, let them raise their fees if necessary, having regard to the competition between them to give the best deal, but are they entitled to offer a lesser exchange rate than that authorized by our Cambio system and Commercial Banks? Don’t we [Bank of Guyana] regulate them at all? I believe that we established some time ago that as much as 300 million US dollars is being sent to Guyanese from the US, Canada and the UK annually to relatives here, in which case if the exchange rate of G$210 is used that amounts to 63 billion Guyana dollars, but WU is paying 202.1675 to 1 US$, which means that they are exploiting the poor Guyanese people who are being supported by their relatives abroad to the tune of 2.35 billion dollars [63 billion- 60.65 billion]. Furthermore, the exchange rates of WU and MG are as follows; if you are in Guyana and are sending money to the US the exchange rates are WU G$201.89 inbound, G$214.21 outbound, and MG G$202 inbound and G$213 outbound, a spread of almost 12 and 11 respectively. My Bank’s spread is 6. i.e. G$210 buying and G$216 selling. At this time also, I discovered, there seems to be a very big shortage of US dollars in Guyana.
What exactly is our Bank of Guyana doing about this? WU and MG have to be licensed to operate here, so they have to account to our government and our people at some point, who exactly at the Bank of Guyana is paying attention to this usury? Or are they also asleep at the wheel?
WU and MG should be allowed their service fees since they are entitled to it, but they should not be allowed to manipulate the exchange rate in this manner, when such massive amounts are being taken from our poor citizens, and someone must regulate them on behalf of the poor people in this country.
Yours faithfully,
Tony Vieira
