India Post to tie up with overseas remittance cos

MUMBAI: Receiving money from your near and dear ones working abroad will get a lot easier and speedier. India Post will be entering into arrangements with private remittance players abroad in order to facilitate remittances, especially in non-metro areas.

While most money transfer services are concentrated in urban centres, the department is looking at leveraging on its vast network of post offices deep in the country’s hinterland. The mechanism that the department is looking at is the one that will enable the Indian diaspora and migrant labourers to remit funds to their families settled in rural India, within 48 hours.

Speaking at a seminar in Mumbai on Wednesday, IMG Khan, secretary of the Department of Posts, said, “The pilot project will be rolled out in major metros within a month. The data centre of the Department of Post in New Delhi will receive these statements, which will accordingly be processed in metros within the same day and over a period of two days, in case of villages.”

He mentioned that regions such as the United Arab Emirates, Italy, Egypt and the Middle East offer immense potential for this business.

K Noorjehan, chief postmaster general of India Post, explained that there are two different models under consideration. “One is where we can enter into arrangements with local banks, which have correspondent banking arrangements with overseas players. The other is where we may enter into direct arrangements with global parties.”
For more than three years in a row India is the largest recipient of worker remittances in the world and is expected to maintain this lead position.

While this has been largely due to a sharp rise in the movement of workforce to Gulf countries in the eighties and IT professionals to the US and Europe in the nineties. The demand for Indian labour and technical expertise is expected to continue from these regions. This in turn is expected to push up remittances back home. It is here the funds transfer facility is expected to play a key role.