A Cardiff MP is calling for action amid claims people have been forced to pay tens of thousands of pounds to free African relatives from kidnappers.
Cardiff West MP Kevin Brennan met an Eritrean man who settled in the city and whose nephew was held by tribesmen.
Church group Evangelical Alliance Wales says £70,000 in ransom money has been paid in eight cases connected to Wales.
The Foreign Office said it has not had substantiated reports of UK residents being targeted to pay ransoms.
The United Nations estimates that 36,000 Eritreans left the east African country last year, many heading to Israel and Egypt to flee poverty and other problems.
It has described the growth of the kidnap and people trafficking in Sinai, Egypt, as one of the most unreported humanitarian crises in the world.
Berhane (not his real name) has revealed to BBC Wales how his nephew, a 26-year-old teacher, was tortured by his captors to pressurise relatives to settle a ransom demand.
Factory worker Berhane, who came to south Wales in 2008 and has asylum status, contributed around £10,000 towards the £15,000 paid to tribesmen who held his nephew near the border between Eritrea and Sudan last December.
He told BBC Wales how his nephew had his back and arm broken while being held and that three others kidnapped with him were killed.
Berhane said the Bedouin tribesman and other nomadic groups exploit the hostages and then contact their relatives in Africa and the west by telephone.
Berhane revealed how he received an emotional phone call from his sister asking for help.
"If you don't pay them, they kill the hostages and sell their organs for money," he told BBC Wales.
"We paid the money by asking our family and community members, through loans.
"If you report the kidnappers to the police or government, they kill your relative."
New arrivals vanish
Although Berhane's nephew is now safe in a refugee camp in Ethiopia, he still fears for his other family members still living in Eritrea.
It is believed that thousands of refugees and asylum seekers from Eritrea - formerly part of Ethiopia - have fallen into the hands of people traffickers and kidnappers as they try to make their way across the Sudan and Egypt towards Israel.
Many would have been heading for refugee camps of neighbouring eastern Sudan, now home to more than 90,000 people.
The UN says that 70% of the new arrivals then vanish.
Many are said to fall into the hands of ruthless people-smuggling gangs as they try to make their way to Israel or Egypt in search of a better life.
Mr Brennan, who has written to the Foreign Secretary William Hague, said: "It's a terrible, brutal, inhuman business.
"Life is simply valued by the amount of dollars that can be generated by kidnapping in whatever way possible.
"I will put down parliamentary questions in the House of Commons about this and also find out what else the government is doing - and can do - to work with other governments and international organisations to tackle the problem."
The Evangelical Alliance Wales is campaigning to raise awareness and to put pressure on the UK government to act.
It says that there are around eight cases in Wales where Eritreans have been put in the same position as Berhane.
It believes that around £70,000 has left Wales bound for payment to kidnappers and traffickers.
Jim Stewart, public affairs and advocacy officer for Evangelical Alliance Wales, said: "If you think that $120,000 [£70,000] has been paid out of Wales and at the minimum $1m [£650,000] from the UK, you're talking about millions of dollars going from the west to criminal gangs in the Sinai region.
"When you think of the volatility of the region and the potential of the region to be destabilised - with gun smuggling and a rise in radicalisation - we've got a very serious problem on our doorstep. We need to work hard to stop it."
A Foreign and Commonwealth Office spokesperson said: "We have also raised our concerns over the mistreatment and trafficking of Eritreans with the governments in the region, including with both the Egyptian and Israeli Ministries of Foreign Affairs.
"We have not received substantiated reports of UK residents being targeted to pay ransoms.
"We would urge anyone with firm evidence of kidnappers targeting UK residents to contact the UK Human Trafficking Centre which can be contacted through the Serious Organised Crime Agency (SOCA)."