BPO-Western Union remittance transfer deal gets good response

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Mahmuda Shaolin
The postal department's move to diversify its income base has started paying dividend as it churned out Tk 0.8 million in fees from Western Union in less than three months by delivering remittances worth Tk 80 million.
The cash-starved Bangladesh Post Office (BPO) signed a deal with the global money transfer agency in July last to transmit remitted money to far-flung areas, where bank services are not available.
"It's incredible. We're overwhelmed by the response," BPO director general Mobassher ur Rahman said Wednesday.
"The Bangladeshi overseas community has found our platform safe and reliable. We're happy to serve them. The new deal with Western Union will help increase our income and enable us to cut back our losses," he told the FE.
BPO officials said under the deal, the postal department earned Tk 0.8 million as fees during July-September period by processing 850 remittances.
Bangladesh has over 10,000 post offices, covering every administrative union and small towns in the country.
The 40,000-manpower-strong department, subsidised by the government, last year racked up a staggering Tk 1.30 billion in losses.
With its nationwide network, BPO is initially delivering the remitted money to the recipients through its 200 outlets.
But the department has plan to increase the number of outlets to 450 by adding 250 more to the network soon, the BPO chief said.
Gradually, it will expand the service to 7,000 post offices, he added.
He said that Western Union has provided the department with computers, fax machines, while also imparting training to postmen in order to make money transfer easier by millions of Bangladeshis living and working abroad.
More than five million Bangladeshis now live abroad, mostly in the Middle East. Last year, they remitted US$6.56 billion, bulk of which was transferred through banks.
The new deal takes Western Union deep into the countryside, where the banks do not have branches, but post offices are the main money transfer channels.
The post office is now getting 25 per cent of the tariff for every money transfer, Rahman said.
Jasmin Akter, deputy postmaster general, foreign post, Dhaka, said frequent power outrage and unreliable supply are affecting the services making it difficult to deliver remittances to remote areas in a faster way.
Despite the initial hassle, she said that the deal was expected to be 'win and win' for both sides.
The American company, with presence in more than 200 countries, has been pursuing the agreement with the postal department for years, after it signed similar deals in India and Pakistan.
The company's money transfer business in India increased by about 69 per cent alone in 2006-07 and it plans to double the number in two years.
In Bangladesh, however, the expansion was slow because the multinational company only transfers the remitted money through several small private banks.