No third wave impact on urban to rural remittances

Mumbai: Urban to rural remittances were largely unscathed through the third Covid wave, with such transfers rising 5-10% at the end of January over December. Most remittance companies ET spoke with said the third wave had little impact on business volumes, pointing to an economy on the mend.

India processes more than ₹15,000 crore in monthly domestic remittances.

“Remittances grew more than 5% sequentially in January; going forward, we expect these numbers to grow keeping in mind the government’s thrust on infrastructure and labour,” said Rishi Gupta, managing director, Fino Payments Bank.

“This growth could see further uptick when private capex starts rolling because you will notice a lot of rural folk moving to these urban construction sites for job opportunities.”

Fino processes more than ₹3,000 crore of domestic remittances every month, out of which Maharashtra is one of the biggest contributors, with a 15-20% share. In the past nine months, the payments bank processed remittances worth ₹29,000 crore.

According to firms facilitating domestic remittance transactions, pent-up demand and strong revival in economic activity in rural areas are driving the volumes.

“There has been no impact of the third wave on our business; the growth of remittances is now deeply and firmly embedded and the business is expected to gain further traction,” said Anand Kumar Bajaj, MD, PayNearby.