Posts Tagged ‘remittances’

Citibank and Banco Bolivariano to provide new remittance service to Ecuador

May 23, 2008

Citibank and Banco Bolivariano have decided to come together to provide new remittance services to Ecuador. This comes after the Inter American Development Bank found that in 2007, Ecuador received more than $3 bn in remittances from abroad. Citibank and Banco Bolivariano now want to provide a cost effective and easy service to the beneficiaries in Ecuador. Citibank clients can send up to $3,000 per day to Ecuador for a flat fee – as low as $5. There are no additional costs for this transaction. Most funds are available for pick up within 24 hours. Those who do not have an account with Citibank, the solution is quite simple. They just need to open an access account with the bank. The access account is a convenient service that would help the customers to manage and save money and also to send cash instantly back home. Citibank has had operations in Ecuador for 48 years, offering world class products and services and contributing to Ecuador’s overall economic development.

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Investment worries for the OFWs

May 12, 2008

The Overseas Filipino Workers (OFWs) have often found themselves supporting their families by saving some money and planning for a better future. In the present day however the OFWs are concentrating on finding ways that would help them to utilise their hard earned money properly. Most OFWs are now trying to explore ways by which their money can be invested in their own country where they would return once they have the means to support their families. But the lack of awareness on the subject has left them clueless. The OFWs are unsure about the future of their savings and investments. They often find themselves wondering whether investing in a particular sector would reap more benefits or whether saving their money would be the right decision.

 

Experts believe buying a residential property is the best that the OFWs can do to save their money and acquire an asset that would benefit them in the long run. Property, they say could be a hedge against inflation. Considering the rise in the demand for better investment solutions several property development companies and consultants are now venturing into the arena and catering to the demands of OFWs living in countries like the UAE, US and Japan. The OFWs too have been taking full advantage of the situation and are availing the facilities provided by them.

G-Cash

May 7, 2008

G cashIt is indeed interesting to see how the remittance business has evolved over the years and an array of facilities has come to aid this thriving industry. G-Cash is again a success story in itself which has become a trendsetter of sorts. Launched in 2004 the service has now grown quite stupendously and there are around 5000 retail outlets and more than 500 G Cash partners across India.

 

Initially when it started out there were just three anchor services, international and domestic remittance, P2P transfers and payments for retail purchases. G Cash brought in a series of revolution and enabled the subscribers to be m-Commerce enabled. The best part about it has been the facility that the non card holders avail from it. It enables its subscribers who may not have a card or bank account to get benefits from the service. By doing so it has attracted a lot of subscribers who could not avail a lot of facilities before.

 

Again unlike SMART which operated jointly with BDO, Globe keeps a record of all transactions and arranges settlement between the retailers and the G-Cash customers. Needless to say it ahs gain a lot of popularity and is a preferred choice any given day. It is valid in countries like India and Philippines which receive high volumes of remittances every year.

Peso vs. Dollar

May 6, 2008

Philippines has traditionally been a consumption-led economy. It has depended on Foreign Direct Investments (FDI) and remittances sent by the OFWs to meet its needs. As the economists around the world predict doomsday for America, the world watches silently the sudden turnarounds of events which are threatening countries like Philippines.

 

If we take the twin case of peso-dollar exchange rate and the remittance from overseas workers it gets quite apparent that the impending economic slowdown is going to cripple the economy. The peso unlike the Indian rupee has not been appreciating as much. The Central Bank of the country has said that it is allowing market conditions to prevail. In other words it is following the wait and watch strategy. The income of the OFWs is not elastic to combat the situation which has resulted in the sharp increase in the prices of almost everything. The peso lost around 30 per cent of its value against the dollar last year and with economies of several Asian countries like Japan, Singapore, Taiwan, Hong Kong and so on facing economic slowdown the situation is evidently acting against the Philippine economy.

 

The bankers are predicting that the peso dollar exchange rate will reach P38 which is an alarming piece of news itself. The scenario calls to mind the Asian Crisis of 1997 which sent shock waves across Asia. Philippines at that point of time took much longer to recover as compared to its neighbouring countries which also suffered loss. The scene is not going to be too different this time around which is quite worrisome.  

Better banking solutions for better remitting

May 2, 2008

Statistics show that most migrants in the US belong to the lower strata of the economy having limited means and a family to support. These migrants hope to have a better life in the developed countries. They transfer money to their families by accessing their bank facilities but sometimes the whole exercise of remittance becomes so pricy that many find it difficult to avail the facilities.

 

As we turn the world into a global village and encourage the influx of migrant labourers in the developing countries the need to systematise the technological aspects and enabling the migrants to take full advantage of the facilities available becomes important. It is therefore, important to develop cheaper technologies to cut the costs of account-to-account transactions. In this regard, the financial institutions like small banks, credit unions and micro finance institutions have to play an important role. This would help in transforming the remittance clients into clients of financial services. If the financial institutions in countries from where remittances are made and the ones which receive them work in unison the whole remittance business would benefit.

 

One thing that needs special mention is that most remittance recipients belong to the lower strata of the society. These people have limited financial knowledge and are mostly unaware of the investment opportunities they can have by using their money to invest in various sectors- thereby enabling the economy to become stronger. The financial institutions should focus on this and spread awareness.

 

As the global economy wakes up to a dawn of economic independence it becomes exceedingly important to educate the masses of the assets that need to be build to support the economy. In the next blog I’ll talk more on the potential the remittances have and the ways by which the government and the financial institutions can benefit from the whole remittance business.