The government has urged banks to revise the current fees that they levy on remittances and has asked them reduce the cost of remittances. In just first three months of this fiscal, the charges imposed on remittances have crossed USD 17 billion.
Talking on the matter, the Overseas Indian Affairs Minister Mr. Vayalar Ravi said, "Banks have been advised to review their existing scale of charges, both at the foreign and domestic end, to minimise the current cost of remittances." He further added that banks need to employ proper risk management systems and regularly supervise remittances to prevent concealed overdrafts.
It should be noted that inward remittances to India via private transfer of funds have increased in the past couple of years.
The minister also added, "Further they may identify remittances as an independent business segment and resort to latest technology for handling large volume at lower cost and explore tie-ups with more correspondent banks at existing and new centers."