Interview of the Month

Mr Bhaskar Rao P, Executive Director, Wall Street Finance Limited

Mr Bhaskar Rao P, 46 years of age, was appointed as Executive Director (Whole-time Director) of Wall Street Finance Limited on 17 August, 2007, with member's approval at the ensuing Annual General Meeting. He has gathered more than 25 years of experience in various fields such a s Mone y Mana g ement , Financ e , International Banking, Foreign Exchange and Remittance business with leading banks. His earlier stint includes significant roles with other public companies such as Emerald Commodities Private Limited and Goldman Securities Private Limited.

At Wall Street Finance Limited, Bhaskar Rao has been effectively handling Foreign Exchange business since the past six years, of which he served the Company as its Chief Operating Officer and Manager under Companies Act, 1956 for three years.

Bhaskar Rao holds a Bachelor's degree in Science and a Master's degree in Economics, along with CAIIB, Diploma in International Banking and MBA in Banking and Finance.

About the Company

Wall Street Finance Ltd. (WSFL) is a leading Foreign Exchange and Money Remittance services provider in India. The company was established in 1986 as a Public Limited Company. WSFL is one of the principal agents of Western Union Money Transfer and operates over 3,500 locations. The company is registered with the Reserve Bank of India (RBI) as a Non-Banking Finance Company. It is a major player in the Haj pilgrimage market and has been catering to Hajis every year for the past several years. The company is operating with 38 branches spread across India.

WSFL service portfolio consists of money exchange, money transfer and distribution of wealth management products and caters mainly to individual consumers. The Gulf region is the company's major market for remittance transfer. The company has been upgraded to the status of Authorised Dealer Forex-II by the Reserve Bank of India.

Q. What are the services provided by the company and which are its target markets?

Wall Street Finance provides money exchange and money transfer services along with the distribution of wealth management products which we call Investment Services. In other words, we are involved in money exchange, money transfer and money management.

As for money transfer services, we have an exclusive tie up with Western Union Money Transfer for the territory of India. For India, the Gulf region is the biggest sender market. In other geographies, we had our group companies' branches in UAE, US, Canada, Hong Kong and London. In countries other than India, we can tie up with any other money transfer companies.

As part of our Investment Services, we offer portfolio management services (PMS) to our clients or can act as a distributor of third party PMS products.

Q. Who are the most significant players in the global and regional markets? Whom do you consider your main competitors, existing and potential?

Western Union is our principal for money transfer and is the biggest player in the global remittance market. In the second place there is MoneyGram. One of our focus segments is the Gulf to India corridor where Xpress Money (a product offered by UAE Exchange Centre LLC) has a strong presence. There are some other money transfer companies, but they can't be called competition. However, the Indian Postal Department can be a potential competitor. With their vast network and experience (that they gained through their association with Western Union), they have now introduced their own products for remittance. So, this can be a future competition for us, particularly from the Gulf sector.

Q. Do you foresee a threat from mobile money transfer services?

It's not a very near future possibility; but may be one year down the line, it can be very competitive. Currently, mobile money transfers are restricted to the domestic sector – that too with a very limited use. They are yet to come into the international market. And we are not into domestic money transfer.

However, that is not to say that mobile money transfer will not take away any market share from the traditional money transfer companies in the long run. But in the current scenario, there are a few issues. The value of the money that can be transferred through mobile is much smaller, and you cannot have physical money delivered through a mobile. You can at best credit it to somebody or present the message before a company, which can make the actual payment. In this way, I think mobile can to some extent replace the internet.

In the money transfer field, distribution companies are not pure money transfer companies; they are the agents of money transfer companies. Our job is to ultimately reach the end customer to make the payment. When money comes into the country, may be from mobile or money transfer internet, someone has to pay. And we're delivering that service, to be precise. So, our place is secure for now. I'm not saying we are secure for all time to come, but it's not the case that the day people start using this system, our job is gone.

Q. Is there any plan to launch your own product in future?

Our group earlier had a product called Instant Cash. However, because of our tie-up with Western Union, we have discontinued expansion and marketing of that product from our company. So there is no plan to start our own product in future.

For about 10 years, we offered this product along with Western Union. Afterwards, we dropped that product from our portfolio because when we felt, it is better to work with the biggest player in the remittance business than to run your own small product. As per our last published balance sheet, the volume of transaction handled by us is around INR 15 billion or $350 million.

Q. Which in your view are the areas that require more attention from the authorities – central banks and governments – in order to make transfer and delivery of remittances across borders more efficient and secure?

Know Your Client (KYC) compliance and Anti Money Laundering (AML) acts are the two important tools that can provide safeguard against security threats. The regulators and authorities need to be vigilant about who are the agents doing the transactions, and who are the beneficiaries taking money through those transactions. These are the two check points. If the agents are not screened before they come into the network, they can definite end up making payments to people who are working against the civic society.

We at Wall Street Finance have a compliance review process, which checks what type of payments are going from us, what are the RBI (Reserve Bank of India) guidelines, whether these are being followed, who are our clients in this business, and what type of background do they have. All these are part and parcel of our appraisal system. Also, Western Union has its own system in place.

In case of any suspect financial transaction, the law requires us to report it to the Financial Intelligence Unit of the government. We must also inform both RBI and Western Union about the same.

Q. How are the customer requirements changing? Which factors do you think will be crucial for growth and success in attracting and retaining clients?

Customer requirements, basically expectations, are becoming higher and higher. There was a time when obtaining a bank draft was a matter of 20 days. Now in this system, the customer expects you to confirm the same day that the person at the other end has actually received the money he sent. Even that is changing. Expectation is coming to the next level; the customer wants money right then and there. Earlier, even with this system of Western Union, customers would be content with the confirmation that money has arrived, and they would come the next day to collect the sum. This is not so any more. Apart from speed, the demand for the quality of service is also changing. These days, people want the right place to take the money from.

Q. How is the industry coping with the increasing concerns over personal data security and consumer rights issues? What measures does the company take to ensure protection of personal data and consumer rights?

These data are not allowed to be viewed by anybody other than the person delivering the services. And it is not available to any other branch as well. Such information is captured in the system of the particular branch that serves the client. Initially, the concerned branch has to take a physical form of the data. Once that process is over, it is not available to anybody. In such cases where a form is to be filled and submitted manually, and therefore can be accessed by a person working with us, it is by a contract that we can stop him from leaking out information to any outsider.

Q. What measure can be adopted by the industry to mitigate the impact of the current adverse developments in the global economy, eg global economic slowdown, rising cost of living and currency movements?

As for the currency movements, we're neutral. We are neither a buyer nor a seller of the currency. It is the customer who is the buyer or seller of a currency; so we remain unaffected by currency movements. And I don't think there was any change in transaction amount due to this. The global economic slowdown, however, has affected remittance from Europe and USA to certain extent; but that is more than compensated by the growth in the Gulf region due to a rise in crude prices. Besides, construction is booming throughout the Middle East. So ultimately what you lost there, you gain here.