Philippines model under study; proposal discussed with Govt
Thomas K. Thomas
New Delhi, June 15
Non-resident Indians (NRI) desiring to transfer funds to India may soon be able to do it through SMS. The cellular industry led by the Cellular Operators Association of India (COAI), in association with the Ministry of Communications, is working on the modalities of the proposed system, which will enable Indians to collect money sent by their NRI relatives or friends from any of the cellular operator's nodal offices across the country. The proposal was discussed on Tuesday during the meeting between Communications and IT Minister Mr Dayanidhi Maran and the GSM Association.
Industry sources said that the proposal is at a preliminary stage and several issues would have to be tackled before it can be launched. They said that the move would drastically reduce the transaction costscharged by banks and money transfer companies at present. "The industry is working on enabling transfer of expatriate funds from abroad via SMS which could be encashed, for example, from any Airtel or Hutch point. This would reduce the hawala transfers and make small transfers viable," said an industry source.
The Department of Telecom has agreed to examine the concept and help pilot it with other Ministries, once the detailed concept is ready, sources said. The proposal must be cleared by the Ministry of Finance and would have to come within the purview of FEMA. The Department of Post, which already has tie-ups with money transfer companies such as Western Union, may also be partnered in the venture initiated by the cellular operators.
Sources said that as the modality of the scheme was being worked on by the industry, it would be difficult to spell out the details at the moment. They, however, said that the Indian operators were looking at the models in use in countries such as the Philippines, where a large population of expatriates use SMS to transfer funds.