An agent, broker or courier in an hawala system; like a good bookie, an hawaladar keeps the numbers and transaction 'nodes' all in his/her head, all through an honor system, something Westerners can't seem to do. They may appear to be in the import-export or translator business.
How Hawala works, as best understood in the West:

1. A customer approaches a hawala broker X hawaladarin one city and gives a sum of money that is to be transferred to a recipient in another, usually foreign, city. Along with the money, he usually specifies something like a password that will lead to the money being paid out;
2. The hawala broker X calls another hawala broker M in the recipient's city, and informs M about the agreed password, or gives other execution instructions for the funds;
3. The intended recipient who also has been informed by A about the password now approaches M and tells him the agreed password. If the password is correct, then
4. M releases the transferred sum to the end recipient, usually minus a small commission.

5. Hawaladar X now basically owes hawaladar M the money that M had paid out to B; thus M has to trust X's promise to settle the debt at a later date.

No promissory notes move between the hawala brokers.
by ancianita November 20, 2013

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