The Foreign Exchange and Remittance Group (FERG) has announced that exchange houses within the UAE’s jurisdiction have been approved to introduce an optional strategic fee adjustment, with a minimum increase of 15%, amounting to Dh2.50. This adjustment, the first in five years, acknowledges the evolving regulatory landscape and associated cost escalations since the previous update.
The fee hike is expected to primarily affect remittance services offered through physical branches, while fees for remittances via exchange houses’ mobile apps are anticipated to remain stable or even decrease to sustain competitiveness in the digital realm.
“This move ensures that exchange houses can sustain the delivery of high-quality services while addressing the changing regulatory requirements and associated operational costs, all of which were maintained without fee increases for the past five years,” said Mohammad A. Al Ansari Chairman of FERG.
The approval follows a thorough evaluation of expenses linked to maintaining high service standards and adhering to regulatory requirements, FERG said in a statement. The decision seeks to strike a balance, ensuring exchange houses remain competitive while addressing rising costs. Despite the approved adjustment, it is projected that the average remittance cost for a $200 equivalent transfer will stay below 3.5%, substantially lower than the global average of 6.2% recorded in 2023, according to the World Bank’s Remittance Prices Worldwide database.
The revised pricing aligns with the United Nations’ Sustainable Development Goals, aiming to eliminate remittance corridors with costs exceeding 5% by 2030.
