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Understanding Regulatory Frameworks: Creating a Stable Environment for Gambian Remittances from Germany

03 May 2024

The fintech landscape in the Gambia is witnessing an exciting revolution, with innovative startups revamping the country's financial landscape. It makes it easy for the Gambians living in Germany and elsewhere to send money online to Gambia from Germany to attend to the economic needs of their families back home.

But behind this onslaught of innovation lies an intricate and complex web of government regulations governing online money transfers to Gambia from abroad.

Don’t worry!

This blog deciphers the regulatory complications you and tens of thousands of other Gambians worldwide need to know and understand. It will make online money transfers more convenient for you.

A Brief Insight into the Remittance Regulatory Framework(s)

The remittance regulatory framework refers to the laws and regulations governing transferring funds from one country to another. These laws and regulations are created to:

·       Prevent the use of illegal channels to move funds across borders

·       Curb anti-money laundering, whose fundamental objective essentially is to finance terrorism worldwide

Remittance regulatory frameworks are created by the country's competent and authorized financial institutions, such as the central banks and finance ministries. Certain institutions are then mandated to ensure compliance with these rules and punish those who don’t comply, whether individuals or institutions.

Why is Regulating the Fintech Industry in the Gambia Important?

With the boom in fintech worldwide, more and more opportunities are being created in this industry. The innovations have gone far enough to the extent of impacting and instead reshaping your overall financial behavior.

In this context, it becomes incumbent upon the governments to regulate the boom, expansion and rapid innovation in the industry lest all of it spirals out of control.

In the Gambia, where financial literacy is relatively low, with several Gambians working in Germany and other foreign countries, earning a living to send money to Gambia from Germany, regulating the remittance industry is of prime importance because its absence can create a perilous situation for you.

What are the Different Levels of Remittance Regulatory Frameworks?

When you look at the remittance regulatory frameworks, you will realize that it is a vast field that is applied at various levels in the industry. As mentioned, it covers your chosen service providers and mandates agencies and institutions to ensure implementation.

Let’s look at the different levels of these frameworks.

The Responsible Agencies and Institutions

Remittance regulatory frameworks vary from country to country because different organizations are mandated to undertake the task in other countries. In the UK, for example, the Financial Conduct Authority (FCA) or Prudential Regulation Authority (PRA) and the Proceeds of Crime Act 2002 are responsible for the task.

In the EU, the AMLD regulations (currently implemented up to 6 AMLD, and BaFin in Germany are responsible for the task.

However, the remittance regulatory framework for the fintech service providers ensures compliance with the following.

Essential Components of Remittance Regulation Framework for Fintechs

Owing to rapid technological advancement, the processing and transferring of remittances has gathered around fintechs. Looking closely, you will realize that your every money transfer from Germany to Gambia is accomplished through fintech using your smartphones.

In Germany, however, the remittance regulatory framework ensures that the fintech service providers follow and implement Know Your Customer (KYC) at the following levels.

·       Customer Identification Program (CIP)

·       Customer Due Diligence (CDD)

·       Simplified Due Diligence (SDD)

·       Enhanced Due Diligence (EDD)/ AML/ PEP Screening

Let’s now delve into the remittance regulatory framework in Germany.

Remittance Regulatory Framework in Germany

The robust German economy means the country has a thriving and expansive job market, strong enough to accommodate job seekers in various fields. According to two separate World Bank reports, the nominal GDP of Germany in 2022 was $4.08 trillion and a GDP Per Capita income of $48,718 in the same year.

This strong economy helps you get your dream job with ease and convenience, but it also points to a solid German financial landscape in which people put their trust blindly.

But do you know the reason for this deep trust in the German financial market?

Well, it owes itself to the strict regulation of the German financial landscape, including the processing of remittances.

Federal Financial Supervisory Authority (BaFin) in Germany

The one agency and institution you can thank for such a solid and trustworthy German financial landscape is the Federal Financial Supervisory Authority, also known as BaFin. It is a legal institution under public law and reports to the Ministry of Finance.

The German federal government appoints its president, and the agency is mandated to ensure that the financial industry remains stable and trustworthy, protecting you from economic crimes, including money laundering, terrorism financing, and corruption.

BaFin is entrusted with preventing financial crimes because the German financial market is significant, with a massive circulation of money for various reasons and an immense amount of online money transfers. Therefore, the institution should take the following steps to create a safe financial environment and maintain people's trust in the market.

Establishing a Business-Friendly Environment

The German government is taking all the necessary measures to create a business-friendly environment for the fintech service providers. These measures include easing taxation, a lax registration process, and easy compliance.

All of these measures are meant to incentivize investments and establishment of businesses.

Crackdown on Illegal Channels

The illegal channels to transfer funds online and make investments are more lucrative owing to certain relaxations such as low taxation. But they create a debilitating effect on the formal economy as these form the illegal or black economy.

Therefore, the German government keeps choking illegal channels by punishing operators and imposing heavy penalties. This leaves you with no choice but to go to legal channels like ACE Money Transfer to send funds online.

Easy Rules and Compliance

While creating friendly policies, the German government ensures that the rules and regulations fintech service providers must follow are reasonable, but they can discourage them. Therefore, the government has imposed rules that are easy to comply with.

This encourages companies to step ahead and make investments in different areas of the German financial market.

ACE Money Transfer Ensures Absolute Legal Compliance and Offers Financial Benefits

You will get immense financial benefits if you make an online money transfer from Germany to Gambia with ACE Money Transfer. The fintech service provider offers live and market-competitive currency exchange rates with speed and safety and charges a low fee on your one or many online money transfers.

The best part is that the firm operates within the legal framework the German government has created for the fintech service providers to operate in. This saves you from landing in the legal complexities, and that too, in a foreign land, in addition to allowing you to transfer funds from a safe financial environment you can access in Germany.

ACE Money Transfer has always ensured seamless compliance with the regulatory bodies in every country where it has been financially present. It has also offered several financial benefits to its valued customers.


What is the remittance regulatory framework?

Remittance regulatory framework refers to the rules and regulations within which financial institutions must operate. If they operate outside these frameworks, they will be punished and fined heavily by the competent authorities. These frameworks are created to draw people to use legal channels to transfer funds across borders.

Why is the remittance regulatory framework critical in the Gambia?

The remittance regulatory framework is critical in Gambia because it is witnessing a massive boom in the fintech industry. This boom is creating immense opportunities as well as threats. It can cause financial destruction if left unchecked, given that financial literacy in the Gambia is low. Therefore, the regulatory framework in the Gambia is critically essential.

What are the different levels of the remittance regulatory framework?

A remittance regulatory framework operates at two levels: one is the government level at which certain institutions and agencies are mandated to implement the framework, and two, the fintech service providers, which are legally bound to comply with the rules and regulations. This is known as Know Your Customer (KYC).

Why is the German financial market considered safe?

The German financial market is considered one of the safest in the world. The Federal Financial Supervisory Authority in Germany, also known as BaFin, is mandated to ensure the safety of the financial market in Germany. It also ensures that all financial institutions, including fintech service providers, comply with the remittance regulatory framework.

How is the German government incentivizing legal fintech service providers?

The government in Germany is taking several steps to incentivize legal fintech service providers and other financial institutions. The government is creating a business-friendly environment, a crackdown on legal and illegal channels, easy compliance rules, etc.


·      German GDP

(GDP (current US$) - Germany | Data (

·      German GDP Per Capita

(GDP per capita (current US$) - Germany | Data (


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