Western Union, a global leader in cross border, cross-currency money movement and payments, wants to scale up its outbound remittance service from India this year, Sohini Rajola, Head of Network — APAC and Middle East, has said.
“Today sending money to India is easy. But for sending money from India there is still a room for process streamlining and improvement. We need to make it as seamless as sending money to India currently is. Scaling our outbound remittance service will be the focus area for Western Union India business this year,” Rajola told BusinessLine in an interview.
“As infrastructure develops at our end, we need to offer the same convenience to people sending money out as well. As and when we are able to offer direct debit or have simplified documents based on guidelines, our product will keep changing,” Rajola added.
India is the largest remittance recipient market in the world with annual inbound remittance of over $80 billion. The market for outbound remittance is however smaller at estimated level of $14 billion as of end March 2021. Infact, there has been a steady growth in outward remittance under the Liberalised Remittance Scheme (LRS) route over the last few years with volumes going up from as little as $1.33 billion in 2014-15 to $ 13.79 billion in FY’18-19 and touch high of $18.76 billion in FY’19-20.
Outbound market biz
“In any country we operate, we want to offer both inbound and outbound services. Outbound is definitely a smaller market in India. But if we have been serving the Indian consumer for 25 years, we definitely want the next phase where we can serve that segment well. It is not about whether it is worth it or not. It is about the gamut of services that Western Union offers,” Rajola said when asked it was worth the effort to focus energies on relatively smaller outbound market in India.
Rajola said that her aspiration this year would be to see how Western Union can work together with the regulator and authorities to simplify the processes and offer the same level of convenience of digital remittances to people sending money out of India as available for those making inward remittances.
Impact of Covid-19
On the overall impact of Covid-19 on remittance business, she said that personal remittances saw resilient volumes despite the pandemic. “Overall as a business we processed more business in 2020 than in 2019. We don’t share corridor-specific information, but our principal increased globally,” she said.
“When the pandemic struck initially, there was an apprehension that this will drop overall remittance volumes. What we saw was there was only minor impact. We saw a big jump on the principal volume that was transacted through Western Union,” she added.
Infact, in the first wave, given the cash restrictions, Western Union’s digital business took off in a big way as from people were sending money to support their family, she added. Also, RBI categorising remittance service as an essential service helped some locations to remain open, according to Rajola.
However, in the second wave there was not that big impact on the retail locations. The impact on the physical retail business has been more muted and digital continues to be showing healthy business, she added. At a global level, Wester Union is on course to clock digital revenues of $1 billion this year.
