Few technicalties to be sorted

Robert Matau


Pacific islanders working in New Zealand and Australia have saved NZ$75,000 in the last six months after using a visa card aimed at reducing remittance costs and getting money faster to the islands.
Westpac’s Ann Templeman Jones says the bank has been committed to reducing the cost of remittances and as a result islanders who, they estimate, have been paying 25 percent of what they send as charges, will pay a bit less.
The bank introduced the Westpac Express Visa Prepaid Card in December last year aimed at reducing remittance charges for islanders working in New Zealand and Australia.
New Zealand allowed 5558 Pacific Islands seasonal workers into their farms and workplaces in the year ending March 31, 2009. 
Forty five percent came from Vanuatu, 24.5 percent from Tonga and 22 percent from Samoa. Solomon Islanders made up 6.3 percent while Tuvaluans and i-Kiribati formed just under one percent each of the Pacific Islands seasonal workers in New Zealand.
The World Bank estimates that the Pacific is losing up to NZ$80 million per annum through these costs and the world best practice was a cost of less than 5%.
Jones said their new remittance card was aimed at cutting the remittance charges.
She told people attending a microfinance workshop in Nadi last month that the saving of NZ$75,000 saving is based on average remittance amount, compared to alternate, secure remittance channels.
The remittance sender uses the primary card to send money and the holder of the secondary card is able to retrieve money using the card at any ATM.
“Our understanding is that remittances to the Pacific can be anything up to 25 percent, but with the Westpac remittance card, we have been able to reduce that by just over three percent and it is quite significant,” she said.
“We have been able to reduce it from 21 percent to 18 percent."
Jones says the bank has not really marketed the card extensively because it was originally introduced by Westpac New Zealand.
One of the technicalities they came across was identifying the second cardholder in recipient countries. 
“We are about to approach regulators from country to country to address this issue.
“We do not want to put pressure on people to change their legislation because this is to stop illegitimate money and for your own protection.
"But the next best option might not to change legislation but to actually change our processes within the branches.”
Most struggling Pacific Islanders depend on money from family in New Zealand to pay for food and education and money transfers across the Pacific are estimated to be worth around $800 million (US$423 million) a year.