
UAE Cracks Down on Illegal Hawala Transfers, Reinforces Financial Law Compliance
Stricter financial regulations and legal reforms target informal money transfer systems across the UAE

The UAE has strengthened its enforcement against unregulated money transfer methods, particularly those involving hawala networks. This strategic move aims to ensure full compliance with the country's financial law and protect the integrity of cross-border remittances.
With recent stability in the Pakistan Rupee and Egyptian Pound, the attractiveness of parallel market transfers has significantly declined. A narrowed gap between official and unofficial exchange rates has further reduced reliance on informal remittance channels.
Operating hawala services without a certified license is strictly prohibited under the UAE’s financial law. Regulatory bodies, in coordination with industry groups, are actively monitoring and restricting these unauthorized transactions to safeguard the financial system.
Public awareness around the risks of using hawala has improved, with increased efforts from regulatory authorities and the broader law community. These initiatives highlight the legal implications of bypassing official channels and promote the use of compliant financial services.
Across the UAE, lawyers and compliance professionals are advising businesses and individuals to align with the latest regulatory standards. Multiple law firms are offering consultancy services to help clients navigate complex financial regulations and avoid legal issues.
To further reduce dependency on hawala, remittance service providers are promoting the Wage Protection System (WPS). This encourages low-income workers to open salary accounts, granting access to legal financial solutions such as secure remittances and salary-backed lending options.
With millions of private sector employees in the UAE, many of whom remain outside the formal banking system, expanding access to regulated financial services is becoming increasingly important.
By reinforcing lawful channels and involving lawyers and law firms in ongoing education efforts, the UAE is building a more secure, transparent, and legally compliant financial environment.
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