RIYADH, 30 November 2004 — Saudi Arabia’s Al-Rajhi Banking and Investment Corporation (ARABIC) and the Islamic Bank Bangladesh Limited (IBBL) have pledged to work together to increase their presence in the local remittance market. ARABIC has mapped out a new strategy under which more than 35 remittance centers will be opened next year in Saudi Arabia, second only after the United States in terms of sending remittances abroad.
The announcement of the new operation was made jointly by Sami Al-Rajhi, chief of Al-Rajhi Exchange and Remittance Centers, and Abdur Raquib, IBBL’s executive president and managing director, during a presentation here Sunday night. The event was also attended by IBBL Chairman Mominul Islam Patwary, another IBBL director Shamshul Hoda; and Manager of Aswag Al-Shamal Remittance Center Abdullah M. Alblaji and other ARABIC officials and prominent Bangladeshi expatriates.
“These two premier banks - ARABIC and IBBL - have resolved to strengthen their relations further in other areas of banking business for the first time. IDDL, which holds 40 percent share in the total remittances sent by Bangladeshi nationals from Saudi Arabia, has one member of Al-Rajhi family on the board of it’s directors,” Sami Al-Rajhi said welcoming the IBBL delegation. “We have an ongoing plan to offer high-tech services to our customers with the help of our correspondent banks including IDDL”.
“We will also expand our ‘Cash Online’ service to ensure delivery of funds to the beneficiary in Bangladesh within two hours”, Sami addied. “At the moment, the Cash Online facility is available in nine countries out of the 54 countries where Al-Rajhi has correspondent banks or facilities to remit money”. He took the opportunity to say that the charge for sending remittance has been reduced from SR25 to SR16. “Currently, we have 38 exclusive remittance centers open for customers all the seven days in a week,” said Sami. Asked as how the Bangladeshi bank will boost its presence and win more market share, Raquib said that IBBL, whose 10 percent shares are owned by Al-Rajhi Bank, also planned to open a branch in Saudi Arabia following the new regulations governing the foreign banks introduced by Saudi Arabian Monetary Agency (SAMA) recently. “We will now work to obtain clearances from the Central Bank of Bangladesh and SAMA as prelude to our plan for opening an IBBL branch here”, he explained.
He said that “ARABIC has also shown interest to promote Saudi-Bangladeshi business by facilitating LCs for exports and imports”. Raquib said that “based on our flow of remittance, we will increase the number of IBBL representatives in Saudi Arabia and we have already deployed one representative in Jeddah recently”. The total remittances sent by expatriate Bangladeshis has exceeded $5 billion mark in a year. In reply to a question about illegal transfers of money and incidents of money laundering, he said that there had been only a few cases and the bank had taken care of them.
The IBBL official, however, refused to give specifics of the suspected accounts or individuals. The Kingdom still remains one of the largest remittance markets in the world and its seven million foreign workers have been remitting some SR78 billion annually. ARABIC offers remittance and draft facilities through its 391 branches. Of the two million Bangladeshi expatriates in the GCC region, 1.2 million are in the Kingdom.
ARABIC, they said, has captured a major share of the Kingdom’s growing remittance market, whence expatriate workers have remitted about SR585.4 billion during the past 10 years. This amount is equal to funds required by the Kingdom for infrastructure projects until 2020. Remittances by the country’s seven million expatriates have increased by two percent annually despite the Saudization drive. This increase is also reflected in the volume of remittances sent to Bangladesh in the recent past.
