History of IVTS
IVTS, including so-called alternative remittance and underground banking systems, pre-date western banking systems and existed as far back as 5800 BC. The systems were established originally on the Indian subcontinent in Asia as a means of settling accounts within villages. Their use as global networks for financial transactions spread as expatriates from the original countries settled abroad. Today, IVTS operations are found in most countries. Depending on the ethnic group, IVTS are called by a variety of names including, for example, hawala (Middle East, Afghanistan, Indian Sub-Continent); hundi (India); fei ch’ien (飞钱 or "flying money"; China); phoe kuan (Thailand); and Black Market Peso Exchange (South America).
Individuals or groups engaged in operating IVTS may do so on a full-time, part-time, or ad hoc basis. They may work independently, or as part of a multi-person network. IVTS are based on trust. Historically, operators have not, as a general rule, misappropriated the funds entrusted to them.
Read more about this topic: Informal Value Transfer System
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