After the 1991 economic crisis, India emerged as one of the fastest growing economies in the world. It recorded the highest growth rate in mid-2000s. The growth was led primarily due to a huge increase in the size of the middle class consumer, a large labor force and considerable foreign investments.
The process of LPG (liberalization, privatization and globalization) moved the country towards the path of growth, making it an attractive destination for investors around the globe. After the 2008 recession, the world economy was badly hit, leading to the global economy slowdown.
Our growth also slipped to 6.8 percent in 2008-09, but recovered again to 7.4 percent in 2009-10. The fiscal deficit was seen rising from 5.9 percent to 6.5 percent in the same duration. In 2003, Goldman Sachs predicted that India's GDP would overtake France's and Italy's by 2020 and Germany's, Russia's, the UK's by 2025, making it the third largest economy of the world after the US and China.
Can the same be said in 2012? It's quite difficult, but not impossible. The current account had always recorded a deficit. Growing oil import bills were the main reason behind the large current account deficit.
By 2011, India's public debt stood at 62.43 percent of GDP -- the highest among emerging economies. In 2011-12, our foreign trade increased by 30.6 percent to USD 792.3 billion, which consists of 38.33 percent of exports and almost 61.67 percent of imports. As of June 2011, exports and imports both grew with monthly exports reaching $25.9 billion for the month of May 2011 and monthly imports reaching $40.9 billion for the same month. It's clear from the above description that the entire problem that we talk about trade deficit, fiscal deficit, and sticky inflation was created over a period of time, the consequence of which has to be paid today in terms of slowing economic growth.
Dependence on foreign investors has grown to a large extent, making the domestic economy rey on foreign flows. FDI (foreign direct investment) in India in 2010 was $44.8 billion and increased 25 percent to $50.8 billion in 2011. But compared to other Asian nations like China, it is comparatively very small. China received more than USD 185 billion in 2010, the highest among Asian countries.
Global issues like slowing growth in US, China and eurodebt concerns, etc., are also impacting the Indian economy. The reducing demand for Indian exports from the US and eurozone will hamper BoP figures. Recently, export figures have improved, reducing the trade deficit to USD 13.4 billion, from 4 percent of the GDP to 3.8 percent. But the market expects the export growth to slow down further. It will further worsen the trade deficit. In the 2011-12 fiscal, India's merchandise imports totaled $488 billion against exports of $303 billion, leaving a trade gap of $185 billion. High crude oil prices and rising gold and silver imports contributed to 32 percent import growth in the last fiscal. Import on these two counts itself were of $217 billion, accounting for over 44 percent of the country's total import bill.
India’s forex reserves drop by $1.37 billion - Thaindian.com
India’s forex reserves drop by $1.37 billion
May 19th, 2012 - 6:10 pm ICT by IANSMumbai, May 19 (IANS) India’s foreign exchange reserves declined by $1.37 billion to $291.80 billion for the week ended May 11, largely due to drop in the value of core currency reserves, official data showed.
The forex reserves has dropped sharply for the second consecutive week. It had declined by $2.18 billion in the previous week.
Foreign currency assets, the biggest component of the forex reserves kitty, fell by $1.33 billion to $257.85 billion during the week under review, according to the Reserve Bank of India’s weekly statistical supplement.
The RBI did not provide any reasons for the change in foreign currency assets.
It said the assets expressed in US dollar terms included the effect of appreciation or depreciation of non-US currencies such as the pound sterling, euro and yen held in reserve.
However, the RBI is understood to have sold dollars from the reserves to curb the slide in the value of rupee.
The Indian rupee slumped to a new intra-day low of 54.91 against a dollar Friday. This was the third consecutive record low of rupee in the last three days. The rupee had hit a low of 54.60 against a dollar Thursday, surpassing previous day’s record of 54.52.
The rupee also hit a new closing low of 54.49 against a dollar Wednesday and ended the week at 54.42.
The value of special drawing rights (SDRs) declined by $25.6 million to $4.43 billion, and India’s reserves with the International Monetary Fund (IMF) fell by $16.7 million to $2.88 billion.
The value of gold reserves remained unchanged at $26.61 billion.
- Rupee dips to new intra-day low of 54.91 to a dollar - May 18, 2012
- India's forex reserves fall by $2.187 billion - May 12, 2012
- RBI to defend rupee from falling further (Lead) - May 18, 2012
- India's forex reserves slump by $3.14 bn - Jan 15, 2012
- India's forex reserves slump by $5.72 billion - Nov 13, 2011
- India's forex reserves slump by $4.29 billion - Sep 17, 2011
- India's forex reserves drop by $1.47 billion - Apr 14, 2012
- India's forex reserves slump by $4.67 billion - Dec 25, 2011
- India's forex reserves rise by $858 million - Oct 29, 2011
- Rupee slide continues: hits new low of 54.60 against dollar (Lead) - May 17, 2012
Tags: bank of india, consecutive record, currency assets, currency reserves, depreciation, dollar terms, foreign currency, foreign exchange reserves, forex reserves, gold reserves, indian rupee, international monetary fund, international monetary fund imf, pound sterling, rbi, reserve bank of india, second consecutive week, special drawing rights, statistical supplement, value of gold
Casino money ready to flow - Columbus Dispatch
Guards await the arrival of the first players at the downtown Horseshoe Casino Cleveland before its opening on Monday.
Pro-gambling interests have invested heavily on a simple bet: There is money to be made in Ohio.
Construction costs alone for four casinos will approach $1.5 billion. Millions more were spent convincing Ohioans that casino gambling would give the state a much-needed economic jolt — a campaign debt that as of January was still being paid off.
As the state’s first casino opened in Cleveland on Monday, a review by the Dayton Daily News showed that as of January, subsidiaries of Penn National Gaming Inc. and Rock Gaming were still making contributions to the group that led the 2009 campaign to amend the Ohio constitution and allow casinos in Ohio.
Penn National and Rock each will develop two of the Ohio casinos, which will open in stages through the spring of 2013.
“I don’t know the casino business, but I do know a lot of money flows through it,” state Sen. Bill Beagle, R-Tipp City, said. “I don’t know if they would have invested all that money into a campaign if they felt the risks outweighed the benefits.”
The opening of the $350 million Horseshoe Casino Cleveland will be followed by the $320 million Hollywood Casino Toledo, the $400 million Hollywood Casino Columbus and the $400 million Horseshoe Casino Cincinnati.
The building bonanza follows one of the most-expensive issue campaigns in the history of Ohio, as gambling companies sold voters on a promise of jobs if allowed to open casinos in Cleveland, Columbus, Cincinnati and Toledo.
According to campaign-finance reports filed in January with the Ohio secretary of state, Rock and Penn subsidiaries made $1.8 million in in-kind contributions to the Ohio Jobs and Growth Committee, the political-action committee that led the 2009 Ohio Issue 3 campaign effort. The donation of anything of value is considered an in-kind contribution, such as if a donor pays a consultant’s fee or a printing bill for services provided to a campaign.
Bob Tenenbaum, spokesman for the PAC and for Penn National, which is building the casinos in Toledo and Columbus, said the contributions are paying off obligations incurred during the campaign. State records show those contributions funded campaign strategy, voter outreach and consulting fees.
“This is a significant amount of money, but Ohio is a large state,” said Tenenbaum, whose company also is considering relocating a harness-racing track to Dayton.
Supporters of the ballot issue overall contributed a little more than $47 million in cash and $18 million for in-kind services to the PAC from 2009 through December 2011.
State Rep. Clayton Luckie, D-Dayton, who supported the casino ballot issue and favors allowing slot machines at Ohio’s seven horse-racing tracks, said the campaign contributions were private funds, and the companies’ prerogative to make.
“It was their money. I’m glad they chose to spend it in Ohio,” Luckie said. “Our constituents were gambling anyway in other states. Now, we have more control over it.”
No magic bullet
The billion-dollar bet that gambling companies placed on bringing casinos to Ohio shows how convinced they are there is money to be made here. But, state officials and economists say gambling alone won’t create the economic windfall some expect.
Overall, Ohio’s four casinos and video lottery terminals proposed for the state’s horse tracks are expected to generate revenue of about $2.7 billion a year, said Rob Nichols, spokesman for Gov. John Kasich. The state’s estimated annual take: $475 million a year from the casinos and $425 million from the slot machines, once all are operational.
“It’s helpful. Is it a magic bullet? Absolutely not,” Nichols said. “Ohio can’t expect gaming to lead the state back to prosperity. It’s going to take more than that.”
Peter Vanderhart, a professor of economics at Bowling Green State University, said he doesn’t think the casinos will have a dramatic impact on the state’s economy, although they will keep some Ohioans from spending their entertainment dollars at out-of-state casinos.
“I wouldn’t call it a bold new era,” Vanderhart said. “At the end of the day, these are service and entertainment jobs. It’s not like manufacturing, where you export a product that brings money back.”
Beagle said he thinks Ohioans have reason to be optimistic, as it appears the state is turning an economic corner. While it remains an unknown whether casinos will be the economic engine that supporters predicted, Beagle said the industry is creating jobs.
It was that prospect that drove many voters to support the casino issue in 2009, which was the state’s fifth major gambling referendum in two decades. A telephone survey of 687 voters, conducted a month before the election by the University of Cincinnati’s Institute for Policy Research for Ohio’s major newspapers, found a majority (53 percent) of casino backers cited the prospect of new jobs as the most important reason for their support of the issue.
The promise to voters made by the Issue 3 campaign: the casinos would create 34,000 jobs — 19,000 construction jobs and 15,000 permanent jobs.
Last week, Nichols said the state did not have an updated jobs number for the casinos, and Tenenbaum said it still is too early to tell how many jobs will be created.
But, he added, “We said 1,200 permanent jobs at the Toledo (casino), and we’ve already surpassed that and we’re not even open.”
Social consequences
Beagle said that voters made it clear they were ready for casinos in Ohio when they passed Issue 3.
“I have hope for great success for the casinos,” he said. “I’m optimistic for the economic benefits, but I also understand there are social costs.”
Ohio lawmakers are preparing for the potential social impact of gambling on communities by earmarking funds for addiction services, Beagle said. The version of HB 386, an overhaul of state gambling laws passed by the state Senate on Wednesday, would give the Ohio Lottery Commission discretion on how much video-slot-machine revenue to earmark — up to 1 percent — for gambling-addiction services.
A conference committee of House and Senate members will meet to reconcile differences between the two versions of the bill.
Sen. Peggy Lehner, R-Kettering, said she’s concerned about the proliferation of gambling in Ohio, beyond the four casinos.
“My sense is that every time we turn around, we’re discussing another venue: video lottery terminals at racetracks, charity card rooms,” Lehner said. “My concern is that we’re seeing an explosion of gambling without paying any real attention to the consequences.”
She said the state needs to pay more attention to gambling addictions and crime related to gaming.
Robert Walgate of the American Policy Roundtable, a conservative, anti-gambling group, has been making the case for three decades that casino gambling and good government don’t mix. Currently, the Roundtable leads a number of plaintiffs in a suit filed to enforce the constitutional language of Ohio Ballot Issue 3.
“Once voters say yes to ‘limited’ casino gambling, the industry takes yes to never mean no,” Walgate said. “Sadly, the governor and Statehouse politicians are only too willing to please the new casino overlords. The voters have been kicked to the curb along with the constitution.”
josmith@DaytonDailyNews.com
Save money and help the environment by checking on your water quality - WMI Central
Posted: Thursday, May 17, 2012 5:00 pm | Updated: 12:21 am, Sat May 19, 2012.
(ARA) - Bruce Farrar didn't like what hard water was doing to his home.
"Our dishes in the dishwasher were terrible," says Farrar, who lives in Newport Beach, Calif. "The inside of the dishwasher was just covered with calcium. Also, our showers had glass doors and I had to put a special cleaner on them because of the calcium buildup."
But the problems didn't end there. Hard water was also preventing the family's clothes washer from functioning properly, requiring the use of more soap and hotter water, which increased Farrar's grocery bill and energy costs. The added energy needs were also putting more wear and tear on his hot water heater, decreasing its lifespan.
Nearly 90 percent of American homes have hard water - water containing high levels of calcium and magnesium, according to The U.S. Geological Survey. The hardest water is commonly found in the states that run from Kansas to Texas as well as in Southern California. How can you tell if you have hard water? If your shampoo and soap don't lather up like they should, if you see scaling on your pipes and showerheads or if you have nasty brown rings in your sinks and toilets, your water is probably hard.
To know exactly how hard, and what to do about it, you should have your water diagnosed by a water quality professional. The Water Quality Association has several resources on its website to help you locate a reputable company, and many offer this service for free.
In order to make hard water into soft water, you have to remove the calcium and magnesium and the only way to do that effectively is with a salt-regenerated water softener. These work by running the incoming hard water through a resin filter that traps the calcium and magnesium in the water, as well as any iron, manganese or radium ions by replacing them with sodium ions, which must be occasionally recharged.
There are other products that claim to condition water using an electro-magnetic charge instead of salt ions, but they do not really soften water. These devices cause the hard minerals in the water to attract and form into an amorphous sludge which remains in the water.
According to the Water Quality Research Foundation, there are many benefits of true salt regenerated water softening including cutting detergent use by as much as 50 percent and allowing washers to clean clothes with cold instead of hot water. Soft water also helps dishwashers clean better, sometimes allowing you to use half the detergent. Finally, water heaters that don't have to work as hard retain their factory efficiency standards for a full 15 years as opposed to those subjected to hard water which lose almost half their efficiency over the same time period.
With ever-increasing household and energy costs facing American consumers, many are looking for ways to save money. A water softener that helps homeowners use less energy not only saves money, but also benefits the environment by allowing you to use fewer fossil fuels. Washers that use less detergent because of soft water also end up dumping fewer chemicals down drains. Finally, water softening keeps appliances out of landfills.
Eventually, and like many other Americans, Farrar made the decision that enough was enough and decided to invest in a water softener and saw immediate results. Speaking of the issues he was experiencing in the past, "All of that is fine now," says Farrar. "The water softener works well." For more information on the benefits of water softening, visit water-softening.org.
Posted in Home improvement on Thursday, May 17, 2012 5:00 pm. Updated: 12:21 am.
Money troubles raises corruption risk in football - Bangkok Post
There are thousands of players like Mario Cizmek in football, professionals who never fulfilled their early promise yet whose passion for the game takes them to unfashionable clubs to earn a living from the game they love.
Former Croatia footballer Mario Cizmek, who has admitted involvement in fixing eight matches in 2010. Croatia's centre-left government is drafting a new law on sports aimed at bringing more transparency in management and money flows.
Cizmek represented his native Croatia at under-20 and under-21 level. A diagnosis of diabetes halted his rise and he never made it to the big leagues. Instead he became a journeyman, playing for clubs as far afield as Israel and Iceland.
The 36-year-old midfielder, though, has since made a name for himself for the wrong reasons after admitting involvement in fixing eight matches in 2010, raising the prospect of time in jail and a ban from playing the sport for life.
Cizmek said his life started to unravel after his club, Croatia Sesvete, failed to pay his salary, which amounted to roughly 3,000 euros (about $3,900) a month.
"A month or two is not a problem but I did not get my wages for a full year," he told AFP.
He owed the state about 35,000 euros (dollars) in taxes and social contributions and did not want to ask friends and family for loans anymore.
"You lose your dignity and become an easy target," he said, revealing how the organisers of the match-fixing worked on cultivating susceptible players for months.
Cizmek said he received between 2,000 and 3,000 euros ($2,600-3,900) a match and was one of 15 players and football officials sentenced by a Zagreb court last December for rigging eight Croatian First Division (HNL) matches.
For that, he was sentenced to 10 months in jail in the country's first trial of its kind. He is now waiting for Croatia's Supreme Court to give its final ruling. If it finds against him, he will go to prison.
Cizmek stressed that the difficulties he faced did not justify his behaviour and now wants his experience to serve as an example to young players tempted to follow the same path.
"You get just a bit and you can lose almost everything," he said. "Football was my whole life and I lost it," he said.
"You feel so stupid and miserable ... thinking, 'How is it possible that I'm doing this after a honest career spanning 20 years?'"
Cizmek, though, is not an isolated case in the global game.
In Turkey, nearly 100 people, including officials and players from top sides like Fenerbahce, Galatasaray and Besiktas, are currently on trial over claims that at least 19 first and second division matches were fixed during the 2010-11 season.
Italian prosecutors are also grappling with fresh claims of graft, six years after current Serie A champions Juventus were stripped of two league titles and relegated to Serie B for trying to influence refereeing appointments.
Corruption allegations have also rocked the fledgling league in China, while the probe in Croatia was launched in late 2009 after German police provided information about match-rigging and betting fraud across Europe.
Football's world governing body FIFA has launched a new drive against corruption in the game, including an appeal for assistance to Interpol and the establishment of protection programmes for those who blow the whistle on match-fixing.
FIFA estimates that between 400 and 500 billion euros are generated each year by betting on sport -- both legal and illegal -- with between five and 15 billion euros stemming from fixed matches, making it hugely attractive for organised crime.
But in a special "Black Book", the global football players union FIFPro said there was "a clear link between the non-payment of wages and match-fixing".
It found that more than 40 percent of professional players in 12 Eastern European countries did not have their salaries paid on time.
Cizek said the reality of fixing matches is more mundane than simply making mistakes on the pitch and with most first division sides in Croatia struggling financially, it's easy to see how players can succumb to temptation.
"There were eight of us (from the same club involved in match-fixing) on the pitch, it was enough just not to play with 100 percent effort," he explained.
Marketing and sponsorship income have dropped dramatically in less high-profile leagues like Croatia due to the economic crisis, while poor quality games and fans turned off by a string of scandals has left clubs playing to almost empty stadiums.
Anti-graft prosecutors in Croatia suspect several top football officials of taking bribes and fixing matches.
"The current situation within Croatian football is the most critical ever" since the former Yugoslav republic gained independence in 1991, said leading sports journalist Robert Matteoni.
"The main problem is poor management of the federation and clubs, which are on verge of financial collapse."
The Croatian league has vowed to slim down from 16 clubs currently to just 10 by 2014.
"Simply, Croatia's economic environment cannot support 16 professional clubs," added Croatian football federation (HNS) secretary-general Zorislav Srebric.
To tackle the problem, Croatia's centre-left government is drafting a new law on sports aimed at bringing more transparency in management and money flows.
Changes in the football federation leadership are also imminent, media reports have suggested.
Did you know?
You can introduce your kids to edutainment reading with our Student Weekly magazine: Thailand's only all-English entertainment and education magazine for teens and all ages.
Forex Dominator Review Plus Discount And iPad Bonus Revealed For New System - PRWeb
Houston, TX (PRWEB) May 19, 2012
Cecil Robles' new Forex Dominator system is receiving many raving reviews as the program has almost sold out of the 500 available licenses. The program, which has a software program that offers one a low risk and high reward profit potential, providing them with an 84% accuracy to what the FOREX market is going to do at any given time. Along with training and many bonuses, the system is one of the hottest selling programs of 2012.
Forex Dominator reviews that are coming in on the Internet have been positive and are answering the question of people asking if it is a scam. The big draw of the program is summed up in the tagline, "More money. Less effort. No Guesswork. Minimal risk." The writers at http://ForexVestor.com have completed a through review of the program and have drawn out the pros and the cons.
One can view the whole review at http://forexvestor.com/forex-dominator-system-review.
Also on their site, they are offering an exclusive bonus package for all those who purchase from their site. They are offering a cash discount to all those who buy from their site as well as giving Apple iPads away. One can get all the details and take advantage of the offer by going here: Forex Dominator bonus.
Cecil Robles is one of the few Forex educators who has been in the business for almost a decade. All of his trading programs have been top sellers in the Industry and has one of the best rates of returning customers. Cecil believes in his training so much that he is offering a 45-day money back guarantee on this system, so if someone is not satisfied for any reason they can return it.
Those who wish to get immediate access to the program can go to the official Forex Dominator system page here.
Aquino has nothing to fear from anti-money laundering law, says spokeswoman - Global Nation
Philippine Daily Inquirer
President Benigno Aquino III. INQUIRER FILE PHOTO
MANILA, Philippines – President Benigno Aquino III has nothing to hide and has nothing to fear from the country’s Anti-Money Laundering Act even when he’s no longer the Chief Executive.
Reacting to Senator Joker Arroyo’s comments that the anti-money laundering law may be used by a vindictive administration against officials of a past regime, Abigail Valte, one of the President’s spokespersons, said Mr Aquino “has no apprehension regarding such things.”
“The President has always been willing to answer any issue that has been thrown at him,” Valte said on radio. “The President has always been very upfront with what he has and he‘s always been very willing to answer questions on it.”
Valte said that even before President Aquino’s statement of assets, liabilities and net worth for 2011 was released, he already indicated the increase in his net worth because of his inheritance of the entire Times Street residence from his late parents.
Arroyo has been quoted as saying that he and Senator Edgardo Angara warned then President Gloria Macapagal-Arroyo about the dangers of an anti-money laundering law.
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Tags: anti-money laundering law , Benigno Aquino III , Government , Politics , SALN
Rupee plunges to fresh low before RBI pulls it back - zeenews.india.com
Mumbai: The rupee on Friday gained 5 paise to close at 54.42 against the dollar with RBI's swift action pulling it back from near 55-levels touched in early trade amid strong capital outflows.At the Forex market, the domestic currency in early trade threatened to breach the 55-level as it slumped to 54.91, its fresh all-time low hit in the third straight session, as copious fund outflows continued amid Eurozone worries.
Dealers said strong dollar demand from importers, mainly oil refiners, on expectation of further rise in dollar on concerns caused rupee's fall.
However, RBI stepped in and stemmed the rupee's slide.
The central bank's Deputy Governor Subir Gokarn in Kolkata today also said RBI will continue to intervene and take administrative measures to protect the rupee, boosting the sentiments in favour of the rupee.
"The approach over the last few months have been a combination of intervention at times when we have felt it will help us stabilise, and some administrative action. This is the approach that will work now," said Gokarn on the sidelines of an event here.
Forex dealers also said that a sudden gush of dollar selling at the fag end by exporters amid recovery in local stocks aided the rupee recovery as the domestic unit touched a high of 54.40 before closing at 54.42. The currency has lost over 22 percent against the dollar in the past one year.
However, experts do not feel rupee's woes against the dollar are over for now as the Indian economy continues to battle with fiscal as well as budget deficits and Greece's possible exit from Eurozone keeps fundamentals intact in favour of the American currency.
"It is difficult to say whether rupee is consolidating at the current level or will fall further as RBI is watching the market," said Viral Shah, Head - Institutional Business, Geojit Comtrade.
The benchmark six-month forward dollar premium payable in October ended up at 154-156 paise from Thursday's close of 151-153 paise and far-forward contracts maturing in April also finished higher at 272-274 paise from 262-264 paise.
The RBI fixed the reference rate for the US dollar at 54.8755 and for euro at 69.4885.
The rupee improved further to 86.04 against the pound sterling from 86.24 previously while fell back to 69.16 per euro from 69.05. It dropped further against the Japanese yen to 68.58 per 100 yen from last close of 67.92.
PTI
Road money is still just a trickle - Vancouver Business Journal
The six-year plan released this week reflects last year’s priorities since nothing has changed.
Someday: Olde Towne Road will be straightened at the sharp turn in front of The Colonies at Williamsburg. When the timeshares were developed, VDOT gave up surplus right-of-way for buffers and The Colonies gave up land to fix the curve. The project will cost $2.66 million.
Croaker Road will be widened to four lanes from Richmond Road to the James City County Library. The project includes replacing a new two-lane bridge over the train tracks. The total project cost is $12.67 million, of which $984,211 is already funded.
Longhill Road will expand to four lanes between Route 199 and Olde Towne Road and get sidewalks. The road is already over capacity. The project will cost $11.8 million, with about $135,000 in hand.
County officials consider this project the most urgent, but Olde Towne and Croaker will likely reach the construction phase beforehand.
Racefield Drive would be paved under a project that sets aside money annually until enough has accrued to complete a project. So far, the county has $69,000 toward $177,600 needed.
Hicks Island Bridge over Diascund Creek will be replaced under a similar funding scheme. The bridge has a low sufficiency rating and has been pinpointed by VDOT as priority for replacement. The project will cost $726,000, of which $280,800 is funded.
The Board of Supervisors will review the priorities next week.
Want to go? The supervisors will meet at 7 p.m. Tuesday, May 22, in Building F of the County Government Complex, off Mounts Bay Road.
Xpress Money may use the UAE as trial market for transaction service - Zawya.com
Saturday, May 19, 2012
Gulf News
Dubai The UAE could be one of two trial markets as the UK-headquartered payment services company Xpress Money makes a move into the individual to business (or business to individual as the case may be) transaction space. Its home market could be the other test market with the trials expected to start post-summer.
“There are very few payments facilitators who are already offering such a service capability and those who are got into it quite recently,” said Sudhesh Giriyan, who heads the regional operations at Xpress Money. “By getting in ourselves at the earliest we expect to narrow any advantage the others may have.
“As of now, we are trying to feel the market out by talking to institutional clients.”
Sources at local remittance houses reckon this is the way forward for the industry. Having institutional clients readily translates into substantial funds flowing through the remittance pipeline and that can only be a good thing for all industry players.
Xpress Money — which came into being in 1999 — only services individual to individual payments, with the UAE — where it has 350 locations operated by various exchange houses — and the GCC being one of its top transactional markets globally. Last year it entered the US and more recently Australia. The plans are to extend coverage to Latin America.
Widely rated
That is why the company wants to get into payment settlements involving individual to business and vice-versa. This category is widely rated within the industry as the next big thing.
Such services could be utilised to make an airline booking, whereby a customer can do the needful at a physical location where the Xpress Money service is available, or for a business to send salary contributions to outstation employees.
“We are formulating the systems and will also require having in place strict compliance practices,” said Giriyan. “Also, future corporate clients would need to be assured that we can provide optimum coverage through physical locations and that’s being addressed. We will also need to maintain bank accounts.
“It’s different to the typical compliance requirements for individual to individual and quite exhaustive.”
Not that remittance volumes involving individuals are showing any signs of slacking off. The estimated volumes last year through the GCC corridor were estimated at $76 billion (Dh278.9 billion). Saudi Arabia alone would account for more than $25 billion, enough to place it among the Top Three worldwide.
“But it’s still the US that is the biggest remittance market by far and the recession does not seem to have had any impact,” said Giriyan. “Last year it was estimated at $51.6 billion and it’s not difficult to see why — the whole of Latin America depends on individual remittances coming out of the US and so are many markets in Asia.
“China, India and Mexico remain the biggest recipients of remittance transactions, which goes to show that customer to customer volumes are not saturated. But customer to business opens up a whole new stream of opportunities.”
By Manoj Nair?Associate Editor
© Gulf News 2012. All rights reserved.
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