The financial world has never been more challenging for NGO not-for-profits. Almost by definition, they operate in challenging regions with underdeveloped or damaged infrastructure, often with widespread corruption or even terrorism. Support for people in these regions is a life-or-death issue, yet getting financial aid into the country is beset by barriers far worse than those encountered in commercial trade payments. Their regions of operation pose significant difficulties in maintaining the transparency necessary to ensure that funds originate and arrive from and to ethical channels, rather than finance crime, terrorism or the unjust power of a corrupt regime.
an unpopular sector
Aid agencies work for the public good, often in difficult or even dangerous cirmumstances. Many are staffed by unpaid volunteers. Yet they're often the victims of criticism for high costs. One major factor in those costs is that of getting money to its destination. The banks have widely de-risked the very areas in which the NGOs operate. As our core expertise lies in opening compliant payment rails into such regions, it was clear that we had much to offer the sector.
There's also suspicion among banks and regulators regarding the internal operations of some NGOs. Our experience is that malfeasance is exceptionally rare, and such transgressions as do occur are usually the result of lack of specialist knowledge rather than intentional wrongdoing. For example, we encountered an NGO revealed an internal vulnerability of which the organisation had no knowledge. Payments were being routed via high-cost routes in accord with the instructions of a middle-manger. While no evidence was uncovered that illicit financial incentives had encouraged this, it pointed to a vulnerability in internal systems. Our own diligence methods had identified the problem almost immediately. We were able to advise our client and corrective measures were applied.
Charities, NGOs and other community benefit organisations are usually created by people with a passionate belief in human rights; they're not necessarily expert in international transfer of funds. There's little advice available to them - In the UK, for example, HMRC advises managers to "adopt a risk-based approach", without offering any useful counsel on what a risk-based approach actually is. We're working to counter this problem by consulting with organisations to educate and provide guidance towards best financial practice.
We now have a specialised team that works with a number of NGOS, including top-ten global aid organisations to provide cheaper, safer and faster payments that reach their destination with minimum friction.
