(MENAFN- AFP) Somali money transfer company Dahabshiil welcomed Tuesday a temporary injunction by a British court allowing its lifeline services to continue, transferring funds dwarfing levels of foreign aid to the war-torn nation.
With no formal banking system, diaspora Somalis depend on money transfer services to support their families, sending some $1.3 billion (1 billion euros) each year, according to aid agencies Oxfam and Adeso.
Barclays, the last major British bank working with transfer companies, had previously said it would close all accounts with money transfer systems, cutting a $500 million (380 million euro) yearly flow to Somalia.
But Dahabshiil challenged the move in a London court.
"The court handed down its judgement, granting an interim injunction which has the effect of preserving Dahabshiil's banking arrangements with Barclays until the conclusion of a full trial," the company said in a statement.
Banks have been tightening rules in a bid to comply with international regulations against money laundering and the funding of groups accused of terrorism, but experts said that there had been no actual cases recorded of regulatory failures by Somali companies.
It was feared that closing organised transfers could drive them underground.
"This is not just a victory for Dahabshiil," the company added. "It is a victory for the millions of Somalis and other Africans, many of whose livelihoods depend on our services."
Somali Prime Minister Abdi Farah Shirdon welcomed the decision, while warning that a "permanent solution must be found to keep open this vital lifeline."
Long term solutions would be to set up formal banking systems, experts say.
Somalis send money back home via transfer businesses which can accept deposits abroad and immediately credit recipients back home.
But regulations require transfer systems pass money through a bank account.
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