Through its enterprise and business service division, telecommunications provider, Telkom Indonesia, has announced that it will expand its current remittance service with a launch in Japan by the end of November. The operator will partner with Tokyo-based remittance company Kyodai Remittance. The service, which is known as Delima (meaning “pomegranate”), will target 40,000 Indonesia migrant workers who live there. The operator expects to process approximately IDR 100 billion (US $8.2 million) in remittances from Japan next year. Telkom already has remittance services available to its country’s migrant workers who live in Hong Kong, Taiwan and Malaysia and also expects to offer the service in Saudi Arabia in Q2 2015. With its projected growth of international remittance services, Telkom Indonesia expects the transaction value of its service to reach between IDR 600 billion (US $49.2 million) and IDR 700 billion (US $57.4) in 2015, more than doubling this year’s estimated value of IDR 300 billion (US $24.6 million).
As it has become increasingly necessary for mobile operators all over the world to look for alternatives to traditional ways of generating revenue, the fees and possible data use charges that operators receive in connection with remittance services are viable sources. Streamlining remittance processes through mobile networks is an obvious extension of the functionality of mobile money. Through mobile remittance, funds can be sent to recipients without the need of a physical processing center or personnel. This reduces the costs of sending money and thereby makes remittance services accessible to more people, especially in developing countries.
Telkom Indonesia is offering its remittance services in countries where there are not only large numbers of Indonesian migrants but where the operator has also expanded its businesses. Although remittance services are no longer seen as innovative business offerings from operators, we believe the need for such services will continue to grow, and operators that can provide mobile money transactions across countries and also enable interoperability will potentially see revenue gains not only from the remittance business but from fees and data use associated with all types of mobile wallet transactions.
The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues or to speak with the research team: http://www.tarifica.com/contactus.aspx
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