Finance

their customers better and most of them have already adopted sophisticated systems. Today, the concern is whether the regulatory bodies would term them as CBSs or just another Loan Management systems (LMSs)

In our pursuit for a banking solution provider that meets the demands of the centralized banks and the NBFCs, we learnt about Pio-Tech. PioTech, a Jordan-based software solution provider, has marked its name in the banking industry for delivering some of the most effective and creative banking solutions. It has served the purpose of digital transformation and business acceleration across the Middle East and the African Continent.

One of the reasons for its nomination for the ‘Most Innovative Banking Solutions Provider in Jordan, 2021’ at International Business Magazine was the level of flexibility it offers for different kinds of customers. Its clientele includes – Jordan Commercial Bank (JCB), Palestine Investment Bank (PIB) Group, Arab Jordan Invest Bank (AJIB) Group, NCBA Bank in Kenya, Housing Bank for Trade & Finance, Safwa Islamic Bank and similar others. The true innovation lies in the fact that the platform delivered for each of these institutes is a Banking Intelligence solution that is customized by Pio-Tech for each of its clients to meet their specific needs.

Pio-Tech describes Bank-BI as a ‘Performance Acceleration’ platform and an ‘Enterprise Banking Analytics’ solution that aids its clients in delivering performance and executing strategies that enhance services and customer engagement.

The Bank-BPM platform is a Banking Processes Management Platform that integrates with multiple systems, enabling data exchange through a smart hub.

The Bank-CEP platform provides a ready to implement solution that manages the customer journey across multiple touchpoints.

The Bank-BI Enterprise Compliance Platform is a full suite of business products that enable banks to efficiently and automatically comply with international regulations and auditing standards.

Capabilities of the Bank-BI Enterprise Compliance Platform

In more than 15 years, Pio-Tech has completed more than 400 projects with 100 Blue chip clients across 14 countries largely based out of the Middle East and Africa nations.

Banking solution providers like Pio-Tech consider Information management and Risk management as the highest priorities of the financial institutions. Institutes that have installed these systems have reported improved quality in documentation processes and removal of redundant intermediate processes. The intelligent business tools have enabled retention and building of better customer relationships and customizable product offerings.

Article by Ujal Nair

Shashank Agarwal

Managing Director Salasar Techno Engineering Limited

Salasar Techno Engineering has bagged a legal tender worth Rs.170 crore from RITES Limited for Railway Electrification. The deal had been accomplished between the two parties for ‘’Railway Electrification of 25kV OHE works including TSS General Electrification, Civil Engineering works including Tower Wagon Shed, Service Buildings, Staff Quarters, Track works and Signalling and Telecommunication works on existing track of single line section of Udaipur city (Excl.) – Himmatnagar (Excl.) 210 RKM (234.99 TKM) section of Ajmer division of North Western Railway.”

Mr. Shashank Agarwal, Managing Director of Salasar Techno Engineering Limited was delighted on receiving the orders and he stated, “RITES is embracing the country’s agenda of modernizing our railways and Salasar is honored to be a part of it. The electrification of railways in the state makes us a significant contributor to the national agenda of completely electrifying the Indian Railway network and facilitating integrated development infrastructure for overall growth.”

Press Release Received on mail from Salasar Techno Engineering Pvt Ltd. Scan to read the company’s sales performance in 2021

How digital loans could change the global financial credit crisis?

Many entrepreneurs across the world have, at some point of time, experienced the burden of acquiring capital or fundings for their business ventures. The challenges vary from lengthy and complicated procedures to short amounts dispersed by the financier over long intervals. The lack of documented credit history and proper integration of technology into the whole loan sanction process further complicates matters. This is exactly the reason that has led to the current popularity of unsecured loans through Fintechs.

The unsecured business loans are turning out to be the real game changers for some of the small and medium scale businesses in the developing countries. The modern digital lending platforms leverage technology to optimise the entire loan approval process and even the recollection process. With the advent of the digital lending platforms, the lenders themselves do not have to take much risk. Now there is a third party app that comes in and says,’the risk is all ours and the profit is all yours’.

We talked to Amit Kumar, founder and CEO of Galaxy Card, a digital lending platform in India, to understand how the digital lending structure has evolved in some of the developing countries of the world. We further explore the new possibilities brought about by the digital lending platforms.

Tradition making way for Practicality

Amit explains, “In India, we had a ‘buy the stuff now and then pay it later’ scheme on a monthly ‘Khata’(account) kind of set up with our local grocery stores. That was something that was used by almost everyone because we never used to carry cash almost every time. Children in the house would frequently run to these stores where their fathers had opened accounts, buy the stuff and then the payment for it was done at the end of the month. Sometimes, this proved to be easier when there was a shortage of change, which is always observed in a cash heavy economy like India.”

The business models of some of the traditional lenders have not changed much but the introduction of the digital lending platform is helping them improve their business processes. They are able to improve the volumes that they are looking to target. The biggest benefit that the lenders are enjoying through these lending platforms is that the term duration of the loans is much smaller. So now, they are able to lend more money, more times, in the same period as earlier.

Amit elaborates this in detail, “Earlier, if you were taking a 1 lakh amount loan and then repaying it over a duration of 6 months, the capital was almost blocked for those six months. But now when you are taking the loan and repaying it in 15 days, 20 days or 50 days, the lenders are able

to circulate that money more often. That itself brings you more chances of somebody becoming late on their payment, accruing interest on the late payment, which automatically increases the revenue for the lenders.”

At Galaxy Card, if INR 1 lakh is borrowed, the payment could be done in 100 payments of INR 1,000 each. This way the lenders are always in stock of some capital to lend throughout the six months. This adds to their compounded net revenue and eventually gives them the confidence to cater to a higher risk market, say the small-size businesses. Amit also revealed that the Galaxy Card platform is also committed towards financial inclusion of people from every strata of the society. This way more people would have a credit score to showcase and consequently leave a compounding effect on the national economy as a whole.

Incentive-driven growth trajectory

The growth of this digital lending segment is more prevalent in countries where the credit bureau records are almost unblemished and widely validated. These are also the regions where we observe higher levels of business volume. Today, we see a wide spread promotional campaign for digital lending platforms from various fintech enterprises. These enterprises are now offering their customers with cashbacks and other incentives for using the digital lending platform.

Amit Kumar

founder and CEO of Galaxy Card

Talking about the factors driving the growth of this segment, Amit explains, “The incentives are attracting more consumers to these digital lending platforms. Credit cards are more of a longterm credit whereas with digital lending, one can bunch up a few

of the payments and then pay it at one go. This is not totally coming out on their credit card usage but it is a separate channel, which is kind of an on-demand credit. One who receives the credit can consume it and then throw it away. This also helps them in keeping the credit score in check by keeping the utilization of the credit cards a little low.”

Sharing his learnings from Klarna, a Swedish-based fintech company in the UK, Amit explains that the firm had introduced something called ‘Annual Metro Pass’. The pass allows a user to make the payment using Klarna’s digital lending platform. This, in turn, guarantees some amount of discount to the users. Instead of receiving monthly payments from the users, the Metro corporation received the annual payment from Klarna, in advance itself. Due to the advance payment, Klarna receives a certain amount of discount from the Metro Corporation and the metro users get certain benefits for using the digital platform.

Long term benefits from short term gains

The biggest threat to the digital lending platforms are the cybercriminals and the fear of debt traps among the borrowers. People have little or no knowledge about the scenarios that lead to a debt trap. All this seems to be culminating in situations where the credit score records are not well maintained or ignored. Due to shoddy bookkeeping practices, either borrowers are conned or the lenders are not able to recover the money. Amit observes that in many of the countries, the legal framework is also biased towards the defaulter, citing the small amount of money borrowed. The defaulter takes benefit of the leniency shown for the Rs 1000 default and goes on a credit spree with 100 other lenders. This way, the small time borrower ends up defaulting over a huge amount from several lenders.

Although the government has set up a legal framework, people need to be educated about the credit facilities and ways to circumvent a debt trap. It is not just the borrowers, the lenders also make mistakes and a legal recourse should be available for everyone. The legal recourse available to the lenders should be made stronger to allow the lenders to operate in a healthy manner. Proper cash flow could ensure a healthy entrepreneurial attitude that could further boost consumerism and thus lead to the growth of the economy. Borrowers need to be more financially disciplined and the lenders need to have a good acumen of the repaying capacity of an individual.

Galaxy Card, presently operating in India, has drawn out plans to expand in other South Eastern markets. Amit has the following words of wisdom for people who are looking for funds for their ventures:

“The borrower needs to ensure that he/she does not go beyond the spending capacity. If you are spending more than what you could repay, then it would be a very bad thing for the credit score and the entire credit system gets tarnished for this. If you have the option and if you could repay then there is nothing that comes close to the comfort of digital lending. As long as the repayment positions are clear, be very bullish about digital lending and go for any offers that you get.”

Article by Ujal Nair. Excerpts of an interview with Amit Kumar by Medhaj Nair

InCorp Global announces Investment in CharterNet in Australia

InCorp Global, corporate services provider, is pleased to announce a platform investment in CharterNet.

Headquartered in Sydney, Australia, CharterNet offers services that cover the accounting & tax advisory, outsourced finance function and government incentives requirements of early stage and established businesses across Australia. The partnership between InCorp and CharterNet establishes InCorp as one of the leading providers of scale in the Australian market.

“Australia is a key market for us and the transaction marks a key milestone in our growth strategy. I am excited to partner with Saeed, Sameer and Shabir and believe that our combined teams and collective expertise will benefit our clients as they look to expand across Asia Pacific.” -Atin Bhutani, Group CEO, InCorp Global “We are pleased to continue building InCorp’s track record of successful transactions and are confident that CharterNet, with its award-winning service capabilities and talented employee base, will be an excellent platform to expand in the attractive Australian corporate services market. We look forward to partnering with the CharterNet team to drive continued organic and inorganic growth through providing great service to our customers.” -Andrew Tay, Principal, TA Associates.

“We would like to thank our valued clients and loyal team for the continued trust in CharterNet over the last decade and growing with us. Through this timely partnership, we are very much looking forward to leveraging InCorp’s support, global services, and network, as we embark on this next stage of growth.” -Saeed Mirzakhani, CEO, CharterNet. “Being in this partnership with InCorp upholds CharterNet’s values of delivering optimal client care and technical excellence to our clients. In staying committed to our vision to being the most people centric advisory firm in Australia, we are also eager and committed to collaborating with InCorp in defining new growth opportunities for our team who have been instrumental in CharterNet’s success to date.” -Sameer Kassam, CEO, CharterNet.

“In this exciting phase for CharterNet, we are delighted to work closely with Atin and the rest of the team at InCorp and be uniquely positioned to expand our geographical footprint across the Australasia region through future potential acquisitions.” Shabir Kassam, Chairman, CharterNet.

The global remittance market started garnering significance when traders started travelling across continents. What began as an in-person delivery system called the ‘Hawala system’ has today evolved into a digital platform where the money is generated and transferred with or without any regulatory supervision. However, the most preferred and legal form of transferring money across the seven seas is still the banking network.

As per a report, the global remittance market accounted for USD 49.49 million in 2020. While another report predicts that the market size is expected to reach USD 42.46 billion in 2028. As per the World Bank, the remittance flow to some of the developing nations surpassed the sum of FDI and overseas development assistance. The World Bank has also observed that the remittance inflows rose in Latin America, the Caribbean, South Asia, the Middle East, and North Africa. Whereas the remittance flow fell for East Asia, the Pacific, Europe, Central Asia, and Sub-Saharan Africa.

The growth of the remittance market is attributed to the increasing number of talents migrating to developed or high GDP nations, the rising acceptance of digital transfer networks, ease of usability, reduced bureaucratic complexities and lower transaction fees. An increase in cross-border transactions through mobile-based payment platforms has further boosted the popularity of the international money transfer market. “The resilience of remittance flows is remarkable. Remittances are helping to meet families’ increased need for livelihood support,” said Dilip Ratha, lead author of the report on migration and remittances and head of KNOMAD.

Numerous banks across Asia have improved their remittance services to meet the rising demand. In fact, the World Bank has stated that inward remittance flow to South Asia has risen by about 5.2 percent in 2020 to USD 147 billion. It was further noted that the average cost of sending USD 200 to the South Asian region stood at 4.9 percent in the fourth quarter of 2020, the lowest among all the regions. Some of the lowest-cost corridors, originating in the GCC countries and Singapore, had costs below the SDG (Sustainable Development Goal) target of 3 percent owing to high volumes, competitive markets, and deployment of technology. But costs are well over 10 percent in the highest-cost corridors. In a 2020 report, it was estimated that remittances to Ho Chi Minh City, Vietnam, will reach about 5.5 billion USD, up 8% compared to 2019. Nguyen Minh Tam, Deputy General Director of Saigon Thuong Tin Commercial Joint Stock Bank (Sacombank), said that remittances remitted through the Sacombank system in 2020 are expected to increase twice as much as in 2019. He attributed it to the incorporation of an API online payment system that created favorable conditions for customers to transfer the smallest amount multiple times.

A Vietnam-based remittance service provider called ‘Saigon Thuong Tin Bank Remittance Company Limited (Sacombank–SBR)’ has earned quite a notability for its premium services across Asia. Established in 2016 with an initial charter capital of 1 billion VND, Sacombank-SBR is linked with many remittance partners across continents and currently registers a charter capital of over 15 billion VND.

Sacombank-SBR is a 100% owned subsidiary of Sacombank – one of the 4 largest

Sacombank-SBR Head office in Vietnam

banks in Vietnam. During the Annual General Meeting of Shareholders for the fiscal year 2020 in Ho Chi Minh City, Nguyen Duc Thach Diem, General Director of Sacombank, announced that its total assets increased by 9 percent reaching VND 492,516 billion. The shareholder report has reported a 75.4 percent profit from Sacombank-SBR in FY2020. Sacombank-SBR bagged the ‘Excellence in Remittance Vietnam 2021’ and ‘Customer Satisfaction in Remittance Service Vietnam 2021’ awards from International Business Magazine, a Dubai-based business magazine publishing company.

International Business Magazine had an exclusive interaction with Tran Minh Khoa (pictured above), Chairman and General Director, Sacombank-SBR to understand the potential of the remittance market in Vietnam. Excerpts of the interview are below –

What are your views on the rise of remittance services among the citizens of Vietnam?

We believe that remittances are increasingly making very important contributions to the prosperity and development of the Vietnamese people. Due to this, there has been rising competition in remittance services every day. In the past, this service was simply seen as overseas Vietnamese transferring money to help relatives in Vietnam as gifts. However, today it expands to many purposes, such as supporting relatives for economic development, foreign workers sending money to their families to accumulate and stabilize their lives, and many more. The youth accounts for a major portion of the Vietnamese population. Many have moved abroad for study and work-related purposes. This large chunk of the population holds great potential for Vietnam’s remittance service. The remittance service is keeping pace with the rapidly changing demands and has moved on to the digitization trend of the financial and banking market.

Earlier, it used to take a few days to send money to Vietnam but now it only takes less than a minute. Relatives can transfer money to Vietnam via technology with full censorship, accuracy and safety.

What are the benefits enjoyed by the customers through your various remittance services?

We supply our customers with multiple choices of service with the highest quality. Beneficiaries can easily receive money, quickly – accurately – securely – at the most reasonable fees and with the highest quality of service. Therefore, when customers use our services, we believe they have experienced our above qualities and advantages. The above characteristics are also our commitments to partners and customers from senders – agents – recipients in a complete money transfer process. We strictly comply with international standards and adhere to Vietnam’s legal frame works.

For remittance service to bank account: Customers will enjoy the experience of remittance sending transactions from abroad to Vietnam within 60 seconds/ one transaction. We have showcased the prowess of our system where the money gets transferred into the beneficiaries’ account in Vietnam in just 30 seconds after the sender hits the send button abroad.

For over-the-counter remit-

tance service: Sacombank is one of the four largest banks in Vietnam with respect to the network size. Beneficiaries go to any transaction points in Sacombank’s network or Vietnamese banks and they just provide the given code to receive money at the transaction points in the most convenient way. In addition, beneficiaries can receive money at any time through Sacombank’s ATMs via SMS codes from mobile phones without going to the bank offices.

For home delivery service: Home delivery staffs are professional, dedicated, and much experienced in the home delivery service. Every year, we regularly organize training for home delivery staff on customer care skills, risk safety, prevention of money laundering, and others. Therefore, customers who receive money will often feel attentive, enthusiastic, and safe with the staff.

Kindly list out a few initiatives taken for the employees as well as the customers during the Covid-19 pandemic.

The steady growth of all of our financial indicators is a feat in itself during the Covid-19 pandemic. Sales, revenues and profits have grown to an alltime high with a marked improvement in our productivity. With timely vaccinations and technological innovations, we have safeguarded our employees. Even during the peak of the Covid-19 outbreak, Sacombank-SBR continued to make improvements and investments in technological solutions. Employees were able to handle their daily responsibilities while working from home. The work from home culture has not hampered our work efficiency or service quality. Our customers have conveyed their satisfaction and gratitude for the smooth business operations and the automation of the money transfer process at Sacombank-SBR.

Article by Ujal Nair

Investment is the right way for building wealth. The kind of wealth that would help develop a better lifestyle for the family, fund the retirement period and even endure the financial crisis. More than anything else, the Covid-19 pandemic has taught everyone the importance of maintaining cash reserves. As governments proclaim that the worst is behind us, the salaried middle-class population is now venturing into the world of investments.

The best investment options in the upcoming years include high-yield savings accounts to S&P 500 index funds. It is the urgency for creating an investment portfolio that has shot up the popularity of cryptocurrency across the world. The one important aspect to consider here is the risk element in all these options. Generating wealth is one part of the story and sustaining it is another. That is exactly where the success story of the commodity ‘Gold’ lays in the history of our economy.

Even though it is not considered legal tender, its value will never be undermined. This is the reason why most of the central banks and financial organizations in the world hold possession of more than onefifth of the global gold reserves. The fact of the matter is, Gold is the oldest form of currency. It predates all the current ones and will continue to exist even after most currencies depreciate in value. The only issue with investment in Gold is that it is not immune from theft and impurities and is not easily accessible.

However, in this digital age, there has been a sudden spurt of cost-effective smartphone-based platforms for buying, holding, selling, and sending digital gold for longterm savings. These platforms are guaranteeing the highest level of safety, security and trust in the gold business. One such company is the US-based Gilded, which is available over the android and Apple iOS platforms for free.

Gilded is currently operational in 12 countries including India, South East Asia, Turkey, the Middle East and more. Registered in Jersey, Channel Islands, with the Jersey Financial Services Commission, Gilded handles Swiss refined gold with 0.999 fineness and is compliant with all London Bullion Market Association (LBMA) gold bar specifications.

Molding the new Gilded Age

Southeast Asian countries like India, China, Indonesia, Malaysia, and Thailand have a deep-rooted affinity towards the ‘yellow’ metal. However, in Europe, only Switzerland and Germany show similar affections for gold. Middle East regions and Turkey are the other two regions with similar fondness. Latin America is generally found to favour gold less. We spoke to Ashraf Rizvi, founder and CEO of Gilded to get more in-depth perspective of the global gold market.

With over 13 years of experience at UBS Holding, Ashraf has held a variety of roles in New York and London. Starting as an FX options trader on the trading floors in Philadelphia, Chicago and New York, Ashraf was a senior member of the FX team at Susquehanna Investment Management,

financial institute could contribute to the betterment of society while also being relevant in the cut-throat competitive segment.

The Gold standard of Digital investment

Ashraf Rizvi Founder and CEO of Gilded

one of the large independent traders in the world. Sharing his insights, Ashraf describes, “My time at UBS has taught me that the gold market is about geography and socio-economics. In certain geographies, the wealthier you are, the more you yearn for gold but in countries like India and China, everyone wants to own gold, irrespective of their wealth status. Today, as the currency is devaluing, people want to hold assets that sustain value and at the same time give the freedom to borrow against it without having to sell it.”

Gilded is hoping to see the benefits of progress more equally shared during this ‘4th Industrial Revolution’, which they call the new Gilded Age. The company believes that a The gold purchased through Gilded are sourced from the Swiss refineries and stored in a fully-insured non-bank vault in Switzerland. As soon as the customer makes the purchase through the app, he/she will be provided with the gold bar’s serial number, refinery, and vault location along with a picture of the exact gold bar. It is further revealed that the entire transaction is recorded on the blockchain for added security.

Speaking about his operations in Asia, Ashraf Rizvi, founder and CEO of Gilded said, “Today, as the currency is devaluing, people want to hold assets that sustain value and at the same time have the freedom to borrow against it without having to sell it. Some of the big exchanges like the Chicago mercantile exchange (CME) or International continental exchange (ICE) both take gold as collateral that you can pledge for trading purposes. Banks accept gold as collateral for which you could get loans. Accessibility to such secured loans is good for the consumers and the financial system, especially during such pandemics.”

During a discussion over a zoom call with Ashraf Rizvi and International Business Magazine, the government’s stringent hold over gold deposits and possessions by the financial services firm was taken note of. It was largely accepted that the assets should be available to the consumers at all times. The regulators should make sure that the companies are operating legally. They should be properly registered and have proper oversight in the places that they operate. Ashraf explained, “Digital Gold can never be like one of the cryptocurrencies. The reason why many are opting for cryptocurrencies is that most of them have lost faith in their country’s currencies. The more you control and prevent people from owning gold, the more you are going to push them into the cyber world and

purely digital, virtual world of cryptocurrencies, which is a big risk for the government because they have no control over there whatsoever.”

Achieving financial goals Digitally

India is benefitting from remittances of around 70-75 billion USD inbound annually. It is one of the largest recipients of inbound remittances in the world. Most of it is coming through UAE. There are over a billion people across the globe who do not have access to the banking system but operate a smartphone. Digital Gold has the potential to open a new avenue of opportunities to all the aforementioned people.

Ashraf predicts, “In the next five years, digital gold will become mainstream just like digital payments have become in India and it will be just another mechanism to own the asset at the end of the day. In due time, it will become bigger than ETFs. Similar to the physically held Gold, the owners of Digital Gold are already capable of earning a return, lend or borrow against it and send it instantaneously over the network from anywhere to anywhere and at any time.”

Gilded and many other similar platforms are making gold digital, mobile and easily accessible. It is giving the less fortunate ones a chance to plan their financial goals, invest in an asset, and leverage the ubiquitous smartphone device for wealth generation.

On a closing note, Ashraf revealed to us, “Gen X and older generations tend to be more inclined towards spending on gold during festivals. Digital gold is appealing to generations across, be it Gen Z, millennials or older generations, as it allows Indians to marry traditions with a digitally savvy lifestyle. Indians can easily buy Gilded gold through a mobile app with minimal effort and gift it to loved ones across the country to celebrate the auspiciousness while saving 6-10% as compared to published Indian gold prices.”

Article by Ujal Nair