Thai e-commerce giant Ascend, which owns the TrueMoney brand, is launching a new money transfer service for Myanmar workers in Thailand that it hopes will be able to compete with a sprawling network of informal lenders who have been used to send remittances from Thailand for decades.
TrueMoney Transfer launched earlier this month and by the end of the year the service aims to have 250 transfer spots in Thailand and 681 in Myanmar, which the company says will cover 91% of migrant workers’ hometowns.
Ascend are vying for fees from the estimated K2.8 trillion sent home each year from workers in Thailand, the equivalent of roughly $1,000 for each of the estimated two million Myanmar people living in the country.
But they face competition from the established brokers who make up the hundi network, who are able to offer same day transfers at competitive rates using trusted contacts in Myanmar.
Ascend is partnering with Myanmar’s AGD Bank to offer the service. “When we study money transfer volumes from migrant workers in the fisheries industry, and industrial, housekeeping sectors, the annual outbound money transfer to Myanmar is $2.3 million,” said U Pyae Soe Htin, Head of the International Banking Division at AGD.
“When we look at what gateways people are using for these huge amounts of money transfers, we have found illegal money transfer services,” he said.
Trust of banking institutions is severely low among Myanmar people following decades of economic mismanagement and a run on banks in 2003, meaning many prefer informal ways to manage their money.
But formal service providers like TrueMoney hope to flip that narrative by presenting themselves as the “more secured” alterative to informal lenders.
“Sending money from Thailand to Myanmar can be very expensive and uncertain,” a press release issued by TrueMoney said.
Anecdotally, the informal networks seems to run smoothly for the majority of migrants, but there have been incidents that have shaken people’s trust. In 2011 a hundi store owner in Bangkok allegedly fled with $60 million that had been entrusted to him.
TrueMoney’s service will waive its fees until the end of the month to attract new customers. After that fees will start at K1,800 per transaction.
Source: Myanmar Business Today
