Data Releases & Key Statements during the Month

RBI raises advance remittance cap to $500,000

On 9 September 2008, Reserve Bank of India (RBI) announced its decision to raise the ceiling on advance remittances made for import of services. RBI in a statement said “It has been decided to raise the limit of $100,000 for advance remittance for all admissible current account transactions for import of services without bank guarantee to $500,000. In case remittances are more than $500,000, the companies would have to obtain guarantee from an international bank of repute before the release of the funds by the authorised dealer banks.” Also, according to RBI, banks must ensure that the recipient of advance remittance complies with the rules of the contract; and in case of noncompliance, funds will be sent back to India. This amendment is expected to simplify import of services by consultancies, infrastructure and design companies. This progress is seen as a step towards gaining fuller capital account convertibility.

Remittances to Mexico registers 6.9% decline in July

The amount of remittance sent home by Mexican migrant workers in July fell 6.9%, compared to a decline of 2.2% in June. This was mainly due to slowdown of US economy and weakening of the US dollar. Director of economic research for Mexican Central Bank added that this is the steepest fall in remittance recorded till date by Mexico.

iRemit posts hike in remittance volume

iRemit, Inc., one of the leading nonbank remittance service providers in Philippines, reported that it dealt with $630 million of remittances during January 2008 to July 2008, which is 56% more compared to the amount of transaction that took place in same period last year.

President and COO, Harris Jacildo said “The demand for the remittance and fulfillment services offered by iRemit is steadily increasing. The company continues to experience strong growth and outpace the remittance industry performance consecutively in the last seven months.”

“The Investment Bank of Iraq is a major institution in the country and we are pleased to be associated with them in extending our presence in Iraq. We look forward to a long and fruitful relationship.”

Jean-Claude Farah, Western Union Regional Vice President for Middle East, Pakistan and Afghanistan

WestLB and VocaLink to cooperate in SEPA payments

On 19 September 2008, WestLB, a German commercial bank and VocaLink, a payment transaction provider have entered into an agreement for processing single euro payment area transactions. The banks added that the agreement would allow VocaLink to use the networking of WestLB in the Sparkassen-Finanzgruppe, whereas WestLB would be able to utilise services offered by VocaLink through its Euro CSM (clearing and settlement mechanism). The direct routing of all payments by banks connected to VocaLink in favour of savings banks in Germany and vice versa would be possible through this cooperation.

Member of the divisional board at WestLB, Steffen Kowalski, said “The cooperation agreement signed with VocaLink will yield process and cost advantages for the Sparkassen - Finanzgruppe. I am therefore particularly pleased that WestLB not only makes an important contribution to single euro payment area (SEPA) but can also further expand its role in the payments field in partnership with the savings banks."

Western Union signs new agent in Iraq

On 29 September 2008, Western Union, a provider of global money transfer services has announced the appointment of a new agent, The Investment Bank of Iraq, a financial institution, for providing the complete offerings of Western Union across 19 branches in Iraq.

Western Union Regional Vice President for Middle East, Pakistan and Afghanistan, Jean-Claude Farah said “The Investment Bank of Iraq is a major institution in the country and we are pleased to be associated with them in extending our presence in Iraq. We look forward to a long and fruitful relationship.”

Remittance fetches $2.05 billion in first quarter

On 30 September 2008, Bangladesh Sangbad Sangstha (BSS) reported that Bangladesh inward remittances stood at $2,054.64 million during the first quarter (July to September) of 2008. The wage earners' remittance accounted for $512 million in September 2008, $721.92 million in August 2008 and $820.71 million during July this year. Of the total inward wage earners' remittance sent, the maximum was routed through private commercial banks ($331.89 million), followed by Nationalised Commercial Banks ($167.09 million) and foreign commercial banks ($8.52 million) during September 2008. The total inward wage earners' remittance during the financial year 2007-08 amounted to $7,914.78 million.

World Bank: Remitting money to Philippines from the US, Spain costlier

According to the World Bank, the cost of sending money to Philippines from Spain and the US is higher compared to remittances made from Japan or Saudi Arabia. The bank added that the Philippines ranked at the 8th position among the 10 countries receiving remittances from Spain with the average total cost of $26.43 for remittances worth $200 and $15.94 for remittances worth $500. The Philippines ranked at the 15th position in terms of the highest average total cost of remittances, out of 19 countries receiving remittances from the US with the average total cost of $27.60 for remittances of $200 and $17.79 for remittances worth $500.