For her research project, intern Chua Shen Yi explored the question of remittance avenues among Bangladeshi workers, diving head first into the Hawala system (also called the Hundi system). She found that although the Hundiwalas are unregulated and operate outside any oversight, many workers find significant advantages in using them.

Chief among these advantages are better exchange rates and convenience, especially for those workers whose families are located some distance from any bank branch.

But workers must exercise extreme care in choosing a Hundi since their hard-earned money is at stake. How do they do their due diligence? Shen Yi explores that too.

In her interview group, she also had workers who preferred using formal banking channels, giving her an opportunity to learn why these workers would rather avoid the Hundi system.

Her paper (PDF, 8 pages) can be downloaded by clicking the link at left.