Banking group Absa has expanded its relationship with global money transfer service provider Western Union, allowing its Internet and cellphone banking clients to send and receive cross-border remittances electronically.
However, the SA Reserve Bank, concerned that the service could be used to circumvent foreign exchange controls, has placed a number of restrictions on the service, which could serve to lessen its appeal.
The electronic service, which is not available to non-Absa customers, may only be used to send money internationally under strict conditions. Absa says it hope the Reserve Bank will reduce the number of exclusions over time.
Absa’s head of group innovation and special projects, Paolo Zambonini, says the Reserve Bank “played a very constructive role” in ensuring the money transfer service could be made available through electronic channels.
But according to Absa, money may be received under the following conditions only: foreign tourists visiting SA, receiving funds from abroad related to their visit; foreign students studying in SA, receiving funds from abroad to pay for their living expenses, tuition and books; earnings of SA residents temporarily abroad; and monetary gifts received from abroad.
Money may only be sent under these conditions: earnings of foreign nationals temporarily resident in SA; gifts other than to charitable, religious, cultural or educational organisations; and alimony payments in terms of a court order.
Charges for the service vary, and are applied at the time of the transaction. Subject to the rules of the country the money is being sent to, there is usually no charge to the beneficiary.
There is a transfer size limit of R30 000, or the maximum allowed by the sender’s normal Internet or cellphone banking limit, or whichever is lowest. And the annual transaction limit for individuals of R500 000 also applies.
Absa says the biggest markets for remittances with SA are Zambia and Zimbabwe in Africa; the US, Canada and Argentia in the Americas; the UK, France and Germany in the UK; and Saudi Arabia and China in the Middle East and Asia. — Staff reporter, TechCentral