Bridging the Gulf

When two Indian conglomerates who were one-time partners in wireless telecom once again come together, along with an international mobile operator and a global bank, it’s an alliance that’s worth taking a closer look at. When Idea Cellular of the A.V. Birla Group, Tata Communications, UAE mobile services provider Etisalat and HSBC India joined hands recently, it was a tie-up that was more significant for its ingenuity than its impact. The four partners have got together to provide a mobile-based remittance service; this will be a pilot study initially and will allow Indians working in the UAE to remit money to their families back home.

To begin with, the service will be available to Idea Cellular’s subscribers in Kerala—a state with a large emigrant population—where the operator has over 2.7 million subscribers. Points out Pradeep Shrivastava, Chief Marketing Officer, Idea Cellular: “The state has close to 2 million emigrants, which is 5.7 per cent of its total population.” Most of them are based in the Gulf, and that’s where Etisalat, with a subscriber base of some 5.5 million, comes into the picture. The person making the remittance from the UAE will use his Etisalat mobile service; Tata Communications will be the central hub for the service; and HSBC will function as the banking channel enabling the transfer of funds and its disbursement in India.

Once the money has been remitted, the Idea Cellular user in Kerala will receive a text message on his mobile. “This form of remittances can only grow over time. This is a huge market opportunity and we view it as an opportunity to transfer money securely and quickly,” says Neelesh Heredia, Deputy Chief Executive Officer, HSBC India.

Vinod Kumar, President (Global Data and Mobility Services), Tata Communications, says this venture offers the company an opportunity to create a global hub for the interoperability of all mobile commerce transactions. The pricing for the service is still being worked out.

Rashed Majed Al Abbar, Senior Manager (Product Marketing), Etisalat, says a transaction of this nature typically costs around 25 dirhams (around Rs 284) in the UAE. “This is clearly a volumes game for us,” he adds. The 2 million emigrants will agree.

—Krishna Gopalan