Top 3 Money Transfer Providers for UK to Honduras

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Summary

Honduras places occasional moderate restrictions on foreign exchange transfers and has administrative requirements for completing international money transfers. The Honduran Lempira (HNL) has a crawling peg exchange rate adjustment system with the US dollar, and USD-HNL corridor is the most popular currency exchange, as high levels of remittances flow from the US to Honduras.

Honduras's money transfer regulations

Honduras is open to foreign direct investment and offers financial incentives for investments in areas such as tourism or manufacturing. The Honduran government sets no limits on the amount of local or foreign currency travelers can bring into the country, however US dollars, when brought into the country must be declared upon arrival. Honduras places occasional moderate restrictions on international money transfers. These restrictions stipulate that investments and income must be repatriated and export proceeds must be surrendered and repatriated. Honduras also imposes maximum daily limits on forex purchases.

Honduras' economic background

Honduras is a middle to low income free market economy, centered mostly around agriculture. One of Latin Americas poorest countries, with more than two-thirds of its population living in poverty, Honduras has a population of approximately 8.1 million and an unemployment rate of 4.2%. Honduras has registered some economic gains in recent years due to an increase in exports and remittances. The countrys economy has close ties to the United States, with exports to the US making up 30% of GDP. The US is also home to the largest community of Honduran immigrants, who send home remittances totaling 20% of GDP. Government spending amounts to 26.6% of the GDP and 40% of GDP is represented by public debt. Honduras closed 2013 with a GDP of USD $39.2 billion.

Opening a business in Honduras is relatively easy, though obtaining the necessary licenses can take up to three months. Though Honduras welcomes foreign direct investment, particularly in tourism and manufacturing, levels of FDI are low due to the increasing level of insecurity and violence in the country, which has the worlds highest murder rate. Vulnerable to natural disasters including droughts, earthquakes, and hurricanes, Honduras is easily affected by economic shocks associated with these events, such as declining export prices for coffee and bananas.

Honduras main economic strengths are centered around the countrys free trade relationship with the United States under the CAFTA-DR. The United States is by far the countrys largest trading partner, accounting for about two-thirds of foreign direct investment. Other strong areas include mineral and agricultural resources and tourism. The Honduran government is also working on expanding transportation infrastructure and diversifying its agricultural sector.

Honduras' Regulatory Authority

Honduras has a well-developed banking system that is regulated by the Central Bank of Honduras and the Superintendent of Banks. The Banco Central de Honduras is the primary monetary and financial authority in Honduras. It supervises the financial system, administers the countrys international monetary reserves, issues banknotes and coins, and sets the monetary, credit, and foreign exchange policy agendas for Honduras. The National Commission for Banking and Insurance (Comisin Nacional de Bancos y Seguros) oversees the Central American Stock Exchange, which is the only stock exchange operating in Honduras.

Currency

The official currency of Honduras is the Lempira (HNL), which consists of coins (monedas) and banknotes (lempiras or lemps). Lempiras are issued in denominations of 1, 2, 5, 10, 20, 50, 100, and 500. US dollars are also accepted in Honduras, while other common currencies, such as euro or Canadian dollar, are not.