The Hindu Business Line : Western Union seeks nod to enter domestic money transfer market

The US-based money transfer company has approached the RBI and the FIPB for permission to enter the market. At present, the company is dealing in international remittances to India.

If Western Union does get the permission, it will be the first private financial services company to start domestic money transfer operations in India. As of now, only the Indian Postal System and banks offer money transfer services within the country.

Ms Gold said for the domestic business, the company is most likely to join hands with India Post, which is one of its primary agents in the global remittance business in India.

"We are looking at domestic transfer service. But it is too early to talk about the tie-ups and when we are likely to start operations," Ms Gold told newspersons. She was speaking at a press conference to announce the opening of Western Union's 21,000th agent location. Mr Anil Kapur, Regional Vice-President, South Asia, said "For the domestic money transfer operations, we need approval from Reserve Bank of India and the Foreign Investment Promotion Board."

India is a growing market for global remittances. In 2005, around $1billion (around Rs 5,000 crore) is expected to come into India through foreign remittances, said Mr Hikmet Ersek, Senior Vice-President, Middle East, Africa and South Asia, of the company. Western Union has a 16 per cent market share of global remittances.

Though India has the largest number of agent locations outside the US, the country's share in Western Union's global remittance business is less than 1 per cent, Mr Kapur said.

Western Union, which has 12 primary agents in India, also plans to expand its network in rural areas, said Ms Gold. "Sixty per cent of the business is in rural areas. So we want to expand the rural network," she said.

The company is also planning to invest $50 million in India over the next few years for network expansion and brand-building, Ms Gold said. In India, Western Union has 12 primary agents, which include seven banks and India Post. It has a network of 21,000 agent locations.

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