The domestic remittance market is growing at a faster pace with the help of organised money transfer channels, mobile money transfer and business correspondents (BCs) of banks.
Nearly 100 million migrants have travelled to Tier-I cities in search of jobs. This results in the overall domestic remittance market growing at an average rate of 10.3 per cent during 2007-13.
Remittances from migrant workers contribute more than 50 per cent to the overall domestic remittances market.
“Our group contributes directly or indirectly around 30 per cent of IMPS-based (immediate payment service based) remittances. This reflects the robustness and acceptance of our prepaid card-cum-wallet channels in this customer segment. We are a participant on the IMPS switch and can settle real time with more than 85 banks and financial institutions,” said Ramu Ramsamy, Managing Director, GI Technology, a pre-paid instrument operator — iCash. The immediate payment service is managed by the National Payment Corporation of India (NPCI).
There is a bouquet of options for migrant workers to send money home. Traditionally, a migrant worker can transfer money by visiting a post office, or depositing the money in bank branches, or handing over the money to friends/families who are travelling back home. “However, a common sight now is that of a migrant worker transferring money to his family using domestic money transfer agents of prepaid cards or bank BCs,” said Mr. Ramsamy.
At present, migrant labours prefer to send money through instant money transfer products compared to the bank route, NEFT (National Electronic Funds Transfer), because of the efficiency and convenience the products offer. Through these channels, a migrant labour can make transactions at his convenience at an agent located near his home. Construction worker Suresh Mishra says, “My brothers and me migrated to Mumbai three years ago to work at a construction site near Kalyan. Initially, I used to transfer money through banks, a complicated and time-consuming process. As a result, I would miss out on my working hours. A co-worker of mine suggested me this new method of money transfer. Now, I can conveniently walk into any agent location, closer to my place at any time, nd send money easily to my family in Gopalganj district in Bihar.” “Contemporary migrants prefer either the traditional postal service or the unauthorised money transfer service to send money to their families or relatives. But the recent trend shows that domestic money transfer services are becoming more popular due to its simple and easy procedures,” said UAE Exchange India & Financial services Managing Director V. George Antony.Recent studies have shown that about 70 per cent of un-banked masses in India need domestic money transfer services, and about 70 per cent remitters send up to Rs.5,000 a month.
The instant fund transfer enables people transfer money across the country at such a pace that it has become a favoured mode of money transfer service among the populace, and is catching up with amazing acceptance.
