NRI Newsletter | Useful Tools for NRIs
What is Money Transfer?
A typical transfer operates like this: the person abroad pays the money at the transfer agent's office in his city; that information is passed on to the office in your city; you go and collect the money. Some agents courier the cheque or demand draft to you or credit your bank account, but these take more time.
There are several money transfer companies here, including Western Union, REmit2India and Cash2India and Thomas Cook also offers their own money transfer facility called Money Gram. These companies take anything from 10 minutes to 5 days to get the money across. You don't even need a local bank account if you use the services of money transfer agent like Western Union (for amounts below Rs 50,000). In some cases, you will need a local bank account so that the cheque can be cashed. Or, you can open a Citibank Rupee Checking Account, which allows your family in India to withdraw fixed sums regularly.
SBI e-remittance for US NRIs
State Bank of India will shortly kick-start its web-enabled remittance service for non-resident Indians based in the US. Global Link Service (GLS), the bank's in-house business process outsourcing division, has put in place the systems required to facilitate quick remittances from the US to India. To make a remittance, all that an US-based NRI will need to do is to log on to SBI's website and post remittance instructions - the sender's bank account details, the amount to be sent/debited, and the Indian receiver's bank account details. The whole transaction from the posting of the instruction to the receipt of funds by the beneficiary can be completed in four days. The entire process takes into account the time required to process the debit-credit instructions at the automated clearing house in the US and the time-zone difference. "SBI's remittance service is targeted at NRIs, who can send up to $5000 a transaction. Unlike money transfer companies, which charge very high commissions for remittance funds in a single day, our pricing will be very competitive," said sources clued in to the developments. Using the EFT route, a beneficiary's account can be directly credited. Where there is no EFT facility available at a branch, the GLS will courier a draft to the beneficiary's address. The charges for EFT is likely be Rs 100 per transaction, while that for each draft will range between Rs 45 and Rs 75, depending upon the amount being sent.
WESTERN UNION
Western Union is way ahead of others with regard to speed of money transfer. It has 10,000 agent locations in India alone. The company has also tied up with the postal department to offer money transfer services in over 3,000 post offices.
Western Union has a reasonably simple process. The sender has to give the Western Union office in his city the details of the transfer, provide the office with some form of identification, and pay the money there along with the transaction fee. To receive the money, you have to go to the closest Western Union/agent office with some proof of identification (voters' card, driving licence or passport) and the money is yours.
Operates in:
190 countries Transaction
time: 15-20 minutes Mode of remittance:
Local cheque, credit card or cash Mode of receipt:
Cash upto Rs. 50,000; local cheque for more Contact: www.westernunion.comCASH2INDIA
Cash2India works in the virtual world, and uses the services of a courier company to send drafts to recipients in India. However, it offers services only in the US, UK and Canada. If the credit card or debit card payment option is used, it takes about two working days to major metros and 72-96 hours to minor metros. If Blue Dart does not serve the revion, the drafts are sent by registered post.
Cash2India has no physical offices. Senders have to log on to the site www.cash2india.com, register, and use a credit/debit card or the 'e-cheque' facility (only in the US). The account is verified and the money (plus transaction cost) is debited from the account. The company transfers the amount to Punjab National Bank, which couriers a demand draft to the recipient through Blue Dart.
Cash2India is a fully owned subsidiary of WorldQuest Networks, a publicly traded company listed on the Nasdaq. It also has a tie-up with Punjab National Bank, which sends out the rupee value drafts.
Operates in:
US, UK and Canada Transaction
time: 2 working days in metros; 72-96 hours elsewhere Mode of remittance:
Debit/credit card; e-cheque facility exists in the US Mode of receipt:
Punjab National Bank draft Contact: www.cash2india.comNo service to Jammu & Kashmir
REMIT2INDIA
Remit2India has offices in countries with a large NRI population-the US, UK, Germany and Canada. And it has some 6,000 delivery locations in India.
The company either couriers the demand draft to the recipient or credits his bank account. The time taken depends on which option the sender chooses, but is usually not more than 48 hours from the time the money reaches the company.
Remit2India offers a wider choice: users can send the money by local cheque, local wire transfer or a direct debit facility. The sender has to register at the company's website www.remit2india.com and choose the mode of money transfer. If it's a local cheque, he simply makes it out to Remit2India and mails it to the company's local office. For a wire transfer, the sender prints out the form on the site and gives it to his bank, asking for funds to be transfered locally to Remit2India. If the sender opts for direct debit, Remit2India can plug into over 12,000 banks and financial institutions in North America. In all 3 cases, once the funds are cleared, the company's India office will courier you a locally payable demand draft for the amount. If you have an account with a bank that's on the company's list-such as ABN Amro, Citibank or HSBC-the money can be directly credited to your account.
Operates in:
US, UK, Canada and Germany Transaction
time: 48 hours for payment to Remit2India Mode of remittance:
Local cheque, local wire transfer or direct debit Mode of receipt:
Credited to receiver's bank account in any of nine banks(ABN Amro,
Citibank, Development Credit Bank, Global Trust Bank, HSBC, IDBI
Bank, IndusInd Bank, StanChart, UTI Bank); facility to credit
to other bank accounts in select cities(Ahmedabad, Bangalore,
Bhubaneswar, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur,
Kanpur, Kolkota, Mumbai, Nagpur, New Delhi, Patna and Thiruvanthapuram);
else, demand draft Contact: www.remit2india.comNo service to Jammu & Kashmir
Thomas Cook also offers their own money transfer facility called Money Gram similar to Western Union.
Western Union and Cash2India limit single transactions to $2,500; Remit2India allows $7,500, but has weekly, monthly and yearly ceilings. None of the service providers allows more than 12 transactions a year. And the maximum cash payout for all Indian residents (those with Indian passports) is Rs. 50,000. A lcoal crossed cheque is used for anything over this.
RBI's Guidelines on Wire Transfers
The Reserve Bank has issued guidelines advising all scheduled commercial banks to ensure that all cross-border/ domestic wire transfers are accompanied by the following information:
Cross-border Wire Transfers
a) All cross-border wire transfers should be accompanied by accurate and meaningful originator information.
b) Information accompanying cross-border wire transfers should contain the name and address of the originator and the originator's account where an account exists. In the absence of an account, a unique reference number, as prevalent in the country concerned, must be included.
c) Inclusion of full originator information is exempted where several individual transfers from a single originator are bundled in a batch file for transmission to beneficiaries in another country, provided the originator's account number or unique reference number is included.
Domestic Wire Transfers
a) Information accompanying all domestic wire transfers of Rs. 50,000 and above must include complete originator information i.e., name, address and account number etc., unless full originator information can be made available to the beneficiary bank by other means.
b) If a bank has reason to believe that a customer is intentionally structuring wire transfers below Rs. 50,000 to several beneficiaries in order to avoid reporting or monitoring, the bank must insist on complete customer identification before effecting the transfer. If a customer does not co-operate, efforts should be made to establish his identity and a suspicious transaction report (STR) should be made to the Financial Intelligence Unit - India (FIU-IND).
c) When a credit or debit card is used to effect money transfer, complete originator information should be included in the message.
Wire Transfers
Wire transfers are an expeditious and secure method for transferring funds between bank accounts. Wire transfers include transactions occurring within the national boundaries of a country or from one country to another.
Salient Features
" Wire transfer is a transaction carried out on behalf of an originator person (both natural and legal) through a bank by electronic means with a view to making an amount of money available to a beneficiary person at a bank. The originator and the beneficiary may be the same person.
" Cross-border transfer means any wire transfer where the originator and the beneficiary bank or financial institution are located in different countries. It may include any chain of wire transfers that has at least one cross-border element.
" Domestic wire transfer means any wire transfer where the originator and receiver are located in the same country. It may also include a chain of wire transfers that takes place entirely within the borders of a single country even though the system used to effect the wire transfer may be located in another country.
" The originator is the account holder, or where there is no account, the person (natural or legal) that places the order with the bank to perform the wire transfer.