December 25, 2016
Dozens of agents in old Delhi – a hub of the money-laundering network – have shut shop in the absence of customers and cash after the Centre last month suddenly banned Rs 500 and Rs 1,000 notes in a bid to curb corruption and promote digital payments. The worst-hit hawala operators in the Capital are the Gujarati businessmen.
The trading is based on trust, has no records or paper trail and legal enforcement, is fast, flexible, non-bureaucratic, and charges low commission rate, but is illegal. There is never any physical transfer of money and the channel is always anonymous. The money enters the system in local currency and leaves as a foreign currency.