Nepal’s formal remittances drop because of increased use of non-banking channels

Experts blamed the inflow of remittances through non-banking channels for a reduced recorded remittance flow to the country in the current fiscal year.

“Around 30 to 35 per cent of remittance is suspected to flow through non-banking channels,” said Chandra Prasad Dhakal, president of Nepal Remitters Association (NRA) during an interaction organised here in the capital jointly by NRA and Society of Economic Journalists-Nepal (Sejon).

Since the beginning of this financial year, the inflow of remittance has started slowing down to around 10 per cent against the growth rate of 40 per cent in the last financial year, said the remitters.

Nepal has seen a boom in inflow of remittances due to increased number of Nepali workers going abroad for work. “However the number of migrant workers has not come down in the current fiscal year,” he said adding that it has gone up by 23.7 per cent. “But the remittance inflow has slowed down to an average of 10 per cent,” Dhakal added.

He also suggested the government to exempt tax on remittances and bring a new policy to refund the taxes collected from workers to discourage non-banking channels and an increase in remittance inflow through banking channels.

Nepal received Rs 209 billion through remittances alone in the last fiscal year. In this fiscal year, by the end of first nine months, Nepal has received Rs 1,164.93 billion. “It shows that the inflow in monetary terms has not decreased,” said Bhasker Mani Gyawali, Executive Director of the Forex Department of the central bank. But he did not deny the slowdown.

“It’s not possible to register 50 per cent growth every year,” said former governor of the central bank Krishna Bahadur Manandhar.

“In the last one decade, remittances have become the lifeline of the national economy as its slowdown has pulled the Balance of Payment (BoP) into a deficit of Rs 22 billion,” said economist Dr Chiranjeevi Nepal.

“The slowdown of remittance can be felt badly in the foreign currency reserve,” he said adding that the forex reserve has depleted in the recent months.

“Nepal Rastra Bank’s data of the first nine months reveals that the forex reserve is enough to pay for imports for six months only wheres it was enough for a year during the same period last year,” Nepal added.

“However, the other side of story has been completely ignored. A remittance-dependent economy cannot attain high growth rate,” he pointed out, “In the remittance-fuelled economy, employment generation and productivity take a beating as the money will be pouring in even without much efforts by the citizens. “

The political instability might have contributed to people loosing faith in banking channels and they are resorting to the informal channels for remittance.

The banking sector is feeling the heat of the slowdown in remittances as they are facing the liquidity crunch.

“The government has taken the problem seriously,” assured revenue secretary Krishna Hari Baskota. “Awareness among workers can also help solve the problem,” he said adding that the remittance should be used in the productive sector as the remittance economy can not last long.

“Around 40 per cent of the remittance goes in the savings and 60 per cent is spent on consumption, which in turn fuels imports,” said secretary. “The trend has to be reversed.”

There are around 52 remittance companies in the country. Remittance contributes 23.6 per cent to the GDP and 30 per cent of the population depends on remittance for their livelihood. It has also helped reduce poverty level.

Text-to-phone phishing attacks show enormous drop in the first quarter

According to the latest report from Internet Identity security company (IID), text-to-phone phishing attacks decreased considerably in the first quarter of the current year. Thus, these attacks have dropped by 62% from the previous quarter.

Nevertheless, credit unions appeared to be the most targeted by text-to-phone phishing attacks, with great amount of them being spoofed in text-to-phone cases. In these attacks, cyber criminals impersonate companies by text message and try to get people to call a fake interactive voice response (IVR) system designed to steal account information.

Meanwhile, the research found that cyber criminals increasingly posed as relief organizations to launch phishing attacks, claiming to help victims of recent disasters, like the earthquakes in Haiti and Chile.

Besides, increasing volume of phishing was used to carry out Internet Domain Name System hijackings, specifically with China's biggest search engine Baidu.com.

Importantly, the major share of phishing volume moved to targeting money transfer sites.

Google preparing payment system for newspapers: Report

Google might launch a micropayment system for newspapers by the end of the year according to reports in an Italian newspaper La Repubblica, which says Google is encouraging publishers to try out a system called NewsPass.

La Repubblica says that, with Newspass, people will be able to log-in to the sites of participating news publishers using a single login. Publishers will be able to designate what type of payment they want to accept, including subscriptions and micropayments. People who find content from participating publishers in Google search will see a paywall icon next to that content and be able to purchase access directly from there using Checkout.

It’s unclear if such a program would be launched in Italy at first, or worldwide. In response to the report, Google said: “We don’t pre-announce products and don’t have anything to announce at this time.”

The idea of a Google micropayment system for newspapers came to light last September when Nieman Journalism Lab posted an 8-page PDF that Google wrote in reply to an RFP from the Newspaper Association of America. The PDF may be downloaded at; http://www.niemanlab.org/pdfs/Google.pdf

Ernst & Young to face investigation over Lehman Brothers' audit

Ernst & Young, the firm who audited Lehman Brothers' operations in the UK, is under investigation in regard to the advice it gave to the US bank in the run-up to its collapse in 2008.

The Accountancy and Actuarial Discipline Board is to examine Lehman's financial statements as well as the use of controversial accounting practices such as Repo 105, a measure which allowed the bank to hide debts from its balance sheets.

Ernst & Young stated it is confident it will be vindicated by the probe.

"[Our] audit opinion stated that Lehman's financial statements for that year were fairly presented in accordance with the relevant accounting standards and we remain of that view," a statement from the company said.

In March, court-appointed examiner Anton Valukas – who spent a year investigating how the collapse of Lehman Brothers occurred – said the use of the Repo 105 "accounting gimmick" had allowed the firm to keep around $50 billion worth of debt of its balance sheet in the first six months of 2008.

He criticized the bank's executives for giving permission for the misleading financial statements to be published.

Wells Fargo enhances its identity theft protection

Wells Fargo has unveiled an Enhanced Identity Theft Protection service, providing customers with an easy way to monitor their credit and check for inaccuracies that may indicate identity theft, is now available. The company has expanded and enhanced the service in response to customer demand.

The improved version of the current Identity Theft Protection service represents an enhanced service that delivers monthly triple credit bureau reports and scores, online calculators, credit score tracker and credit score alerts. The extended version is available through Wells Fargo Insurance and provided by Trilegiant Corporation.

The new version offers a variety of tools to help customers manage credit, including an online "Credit Score Simulator" that lets customers see how a credit score changes if they decide to reduce debt on mortgages or credit cards, refinance a loan, apply for a credit card or consolidate debt into a new account.

Customers' solid interest in protecting against identity theft is one example of a broader concern-managing credit and finances in a turbulent economy, as said Robert Dudacek, Wells Fargo Insurance Direct Response Group Manager. The Enhanced Identity Theft Protection service is available now and customers can receive their credit report and score online in seconds.

8 million Filipinos now use mobile banking

Over eight million Filipinos are now using mobile banking services in the country, which the central bank says would boost more efficient financial services in rural and other hard-to-reach areas at relatively lower costs.

Central bank Deputy Governor Nestor Espenilla Jr. said there are now 49 rural banks offering mobile banking from none before 2005.

These eight million users use the electronic money (e-money) services of major telecommunications companies Smart Communications and Globe Telecom, which offer Smart Money and G-Cash, respectively, BSP said.

These allow mobile subscribers, particularly those without bank accounts, to deposit, transfer, and withdraw money from one e-money account to another in the telecom company's business centers nationwide.

Espenilla noted that the Philippines has been recognized by international organizations for its microfinance initiatives and is considered as the leading pioneer in mobile banking solutions for the poor.

Some banks even lowered interest rates on microfinance loans for clients who use text-a-payment platform by 50 basis points on monthly rates, Espenilla added.

"Technology extends outreach of microfinance and banking services to a large number of bankable but un-banked especially those in rural and hard to reach areas at lower costs and higher efficiency," he said.

He explained that the mobile phone industry in the Philippines serves all income groups especially low income groups and more than 75 percent of the population have mobile phones.

Electronic transactions, which involve the payment of purchased goods and services, could also be used for remittances from Filipinos abroad, Espenilla noted.

“The amount of e-money transactions is already huge, and we expect it to grow further," the BSP official added.

The BSP said it has ordered firms offering e-money services to register with the central bank as an electronic money issuer (EMI).

These could include banks, non-bank financial institutions, and money transfer agents. Those qualified as EMI include stock corporations with a minimum paid-up capital of P100 million. E-money is also not considered a bank deposit and is not covered by the deposit insurance provided by the Philippine Deposit Insurance Corp. (PDIC).

The guidelines also limit the maximum amount that can be loaded to any e-money instrument to P100,000 a month.

Reserve Bank of India prefers the bank-led mobile banking model

The Reserve Bank of India (RBI) prefers the bank-led mobile banking model over the mobile operator-led one, as it offers facilities such as deposit insurance, access to affordable credit and payment system, not just remittance, the RBI governor D Subbarao has said.

The growing concerns about money laundering and financing of terrorism is also a reason the central bank favours a bank-led model.

“World over, there are two distinct models - the ‘bank-led’ model and the ‘mobile operator-led’ model. The RBI has a clear preference for the bank-led model,” Subbarao said while addressing a banking event in Hyderabad last week.

On interoperability of technological solutions, the governor said the priority clearly has to be to facilitate ‘inclusion’ first. ‘Interoperability’ is no doubt important but it can follow. Clearly inclusion cannot wait for interoperability to happen.”

Subbarao also expressed concerns over the tech barrier between banks and customers as the absence of human touch can be intimidating for those just entering the banking network. He asked banks to take extra care to ensure poor are not scared away by technology.

Referendum possible on UBS handing client data to US

The controversial plan for UBS to hand over client data to American tax authorities may be put to a referendum in Switzerland.

Last week, the lower house of the Swiss parliament voted against allowing the data to be passed on to the US, which alleges that almost 4,500 American citizens are avoiding tax by holding secret accounts with UBS.

While it has now reversed its decision and voted in favour of the plan, the lower house has also called for a referendum of Swiss citizens to take place on the issue.

But the idea of a ballot has been opposed by the upper house of the parliament, along with Switzerland's bankers' association, reports the Financial Times.

The referendum proposal is complicated by the fact that under Swiss law, citizens are granted 100 days to get the 50,000 signatures needed for a plebiscite.

If the full period was taken up, the August 19th deadline agreed between the US and the Swiss on delivering the customer information would be broken.

An agreement on what is to be done will have to be made between the two houses before the end of this week, when parliament is scheduled to break up.

Last week, a spokesman for the Inland Revenue Service warned: "We continue to monitor the events in Switzerland and we stand ready to pursue all legal options available to us should the Swiss fail to provide the required information."

The dispute has been rumbling for some time, with UBS agreeing to a $780 million settlement of criminal charges brought against it by US authorities in relation to aiding tax evasion back in February 2009.

A civil action was pursued against the bank in an attempt to access the names of the clients, with the Swiss agreeing to pass over the data in August last year.

European Parliament: Bank bonuses should be capped at 50% of salary

Bankers' bonuses should be capped at a figure equivalent to half of their annual salary, a European Parliament committee has suggested.

The Economic and Monetary Affairs Committee has also called for bank directors at firms which received bailouts to be paid no more than €500,000 ($616,000) a year until all public money has been refunded by their company.

It also wants to see 40 per cent of any bonus payout deferred for a five-year period.

Sharon Bowles, chair of the committee, told Bloomberg: "If bankers and traders want to leave and go to other jurisdictions, it just shows that they do not have confidence in their own performance.

"To those that would leave I say good riddance."

The proposals set out by the committee will be voted on by the full European Parliament in July.

MEP Arlene McCarthy initially proposed the 50 per cent cap for banking bonuses back in March, while she also suggested that up to 60 per cent of such payouts should be deferred over the course of three years.

FSA chairman welcomes chancellor’s plans for regulatory reform

The Chairman of the Financial Services Authority (FSA), Lord Turner, has welcomed the changes to financial regulation outlined by the Chancellor of the Exchequer in his Mansion House speech and Hector Sants’ agreement to remain as Chief Executive of the FSA, leading the transition and the creation of a new prudential authority.

Lord Turner said: "The FSA now has the clarity of direction and timescale as well as the leadership that we need to meet the challenges ahead.

"In particular I am delighted that Hector, who has done so much to transform the FSA during the past few years, has agreed to lead the transition to the new structure in 2012, and to become the first Chief Executive of the Prudential Authority and a Deputy Governor of the Bank of England."

"The crisis demonstrated the need for new regulatory approaches and more intense supervision, and the FSA has already implemented major change. But it also demonstrated the need to bridge the gap between macro-prudential policy and the supervision of individual firms. The Chancellor's proposals for prudential regulation will enable us to do that, while building on the major changes we have made over the last few years. The timescale will enable us to manage the transition in a smooth and orderly way.

"On retail customer protection, the FSA has recognized the need for a shift in our past approach, moving to the more interventionist approach which we set out in our recently published Retail Conduct Strategy. The new Consumer Protection and Markets Authority will have a strong focus on this challenge, while also maintaining strong focus on conduct issues in wholesale products.

"There are important issues still to be resolved – in particular the arrangements for our Enforcement activities and for those Markets activities which relate to exchanges, clearing infrastructure and prudential issues – and we look forward to working closely with the government in considering the relative merits of different possible arrangements for these. But the overall future shape of financial regulation is now much clearer and we are in a strong position to create a future regulatory system which builds on the FSA's achievements over the last few years of major change."

Mobile payments set to double

The value of purchases made by mobile phones is set to more than double by 2012 on back of increase in smartphone usage and greater consumer acceptance of new payment methods

Analyst Jupiter Research has forecast that the rise in smartphones will fuel an increase in mobile payment transactions that will see their value more than double to US$200 billion by 2012.

Jupiter Research said the availability of secure, easy-to-use payment applications and the growing realization of users that they can make e-commerce purchases by mobile will drive the value of payments for physical and digital goods from under $100 million this year to $200 million in two years.

Other findings from the “Mobile Payments for Digital & Physical Goods: Players, Markets & Opportunities, 2010-2014” report indicate that the frequency of physical goods purchased will be higher than average in developed regions such as North America and Western Europe; and brands, retailers and merchants have an opportunity to increase their revenues through targeted marketing campaigns, using apps and mobile web payments as a convenience play for users.

Report author Howard Wilcox said: “Our research showed that the purchase experience has been enhanced by improved mobile commerce transaction processes due to faster mobile networks, more powerful devices and much more user-friendly smartphone apps.

“Amazon Payments for example has recently introduced payment processing tools for mobile devices, enabling smartphone users to buy with one click.”

UK regulatory system set to change

The UK government has unveiled a shake-up of the countries system that will consolidate power within the Bank of England and eliminate the Financial Services Authority, long the main overseer of the nation's financial center, the City of London.

The new Conservative-led coalition government plans to splinter the FSA into three new agencies, including a bank-regulating subsidiary inside the Bank of England. The new regulatory approach was unveiled in a speech last Wednesday night in London by the UK's Treasury chief, George Osborne, who trumpeted "a new system of regulation that learns the lessons of the greatest banking crisis in our lifetime."

In the House of Parliament in London on Wednesday, George Osborne, trumpeted the 'new system of regulation.'

While more ambitious than expected, the structural changes are more functional than specific, leaving for a later date thorny questions over the appropriate structures of banks. The US is debating a range of rule changes that would impact the finance sector in much more extensive ways than Mr. Osborne's proposals. The European Union is pushing its own policies, including new oversight for hedge funds.

Forced to forge a coalition with the Liberal Democrats after a tight election, the Conservatives were expected to move more deliberately on their pledges of financial-system regulatory changes. But the Lib Dems are backing the government's attempt to make a clean break with a regulatory system tarred by the financial crisis, meaning that the changes are almost certain to come into effect.

At the heart of the proposed overhaul—which requires approval by Parliament and would be implemented by the end of 2012—is an empowered Bank of England. In addition to its current responsibility for monetary policy, the central bank will take charge of preventing systemic risks and of day-to-day supervision of the UK financial sector, including foreign companies that operate in the City of London, through a newly formed subsidiary, tentatively dubbed the Prudential Regulatory Authority.

The Bank of England's governor, Mervyn King, will become chairman of the expanded authority. He welcomed the changes as "the right direction of reform." He didn't address his past comments, specifically his argument that big banks should be broken up to separate risk-taking from utility banking, something the City has fiercely resisted.

The revamp has big implications for giant banks around the world, not just those headquartered in the UK. The FSA already has been getting tougher regulating overseas banks' London subsidiaries. The growing clout of Mr. King, who has talked openly of breaking up big banks, could subject the U.K. and foreign banks alike to more draconian oversight.

In the UK, the new agency within the Bank of England will inherit some of the powers of the FSA, which never fully recovered from its legacy of "light touch" regulation of London's financial community in the wake of the financial crisis. Further tarnishing the FSA in the eyes of many Tories, the previous Labour government established the agency in 1998 shortly after taking power, removing bank-regulatory oversight from the Bank of England.

While the FSA will cease to exist on paper, much of its current structure is likely to live on in the new prudential authority. Its supervisory staff is expected to remain largely intact, as is its newly muscular approach to policing banks, traders and insurers.

Even the agency's leader will be the same. The FSA's chief executive, Hector Sants, had announced plans to retire this summer, but Mr. Osborne persuaded him to take the helm of the new agency for three years. Mr. Sants will become a deputy governor of the Bank of England.

A restructuring will eliminate the UK's Financial Services Authority. Two of the FSA's other duties—consumer protection and law enforcement—will be assumed by new independent entities, including an agency focused on white-collar crime.

In addition to fulfilling a Conservative campaign pledge, the revamp of the regulatory system is intended to bring bank supervision under one roof at the central bank. The Tories blame a disjointed approach, in which officials from different agencies didn't coordinate with each other, for allowing the banking system to grow bloated with debt and for impeding the government's response when the crisis hit.

"Because central banks are the lenders of last resort ... they need to be familiar with every aspect of the institutions that they may have to support," Mr. Osborne said in Wednesday's speech, at a black-tie dinner attended by London's financial elite.

The new structure doesn't include a spot for the FSA's well-regarded chairman, Adair Turner, who is expected to remain at the FSA during a two-year transition. Lord Turner endorsed the shake-up Wednesday, saying it resolves the uncertainty surrounding the agency.

The planned overhaul is the product of weeks of negotiations and horse-trading that highlights the delicate nature of the coalition government. In order to win over Vince Cable, the Liberal Democratic business secretary who had opposed abolishing the FSA, Mr. Osborne let him pick at least two of the five members of a high-profile committee charged with making recommendations about the structure of the UK banking industry, according to a person familiar with the matter.

The proposed revamp is likely to prove controversial.

Some experts have said it risks distracting the Bank of England from its paramount role of setting monetary policy and controlling inflation at a particularly crucial time for the UK's struggling economy.

Mr. Sants himself was critical of the Conservatives' proposal to fold the FSA into the Bank of England. "There remains the possibility of tougher times to come for those we regulate," he said in a speech in November. "Now is not the time, therefore, to be diverting resource to looking at structural questions."

Bringing the FSA's supervisory infrastructure under the Bank of England's roof is likely to be especially tricky because of the two organizations' cultural differences.

For example, past and present officials at both organizations say the FSA tends to pay employees up to 50% more than the Bank of England. Senior FSA bank supervisors can pocket more than £300,000 ($444,000) annually, and the agency sometimes doles out lucrative bonuses. Mr. Sants received total compensation of £742,011 last year, more than double the £305,764 that Mr. King took home.

The FSA has argued that to police banks effectively, it needs to lure talent from them, which requires competitive pay packages. A lesser-paid civil-service culture pervades at the Bank of England.

Arrests in “card cloning” raids

Police in 12 countries have arrested 178 people accused of involvement in an international credit card cloning ring that is believed to have netted crooks around €20 million.

According to the Spanish Interior ministry, the arrests come after a two-year investigation that culminated in 84 raids in Spain, Italy, Romania, France, Germany, Ireland, Sweden, Greece, Finland, Hungary, the US and Australia.

The raids turned up 11 cloning 'laboratories' with around 120,000 card numbers and 5,000 fake cards found in Spain alone.

Spanish authorities say the criminal organization split into country-specific sub-groups to carry out their fraud, each with a leader that was in contact with the overall head.

The cloned cards were used to make withdrawals at ATMs and purchases in stores, say officials but the gang is also accused of various other criminal activities, including robbery with force, fraud, extortion, sexual exploitation and money laundering.

Dubai Islamic Bank introduces Al Islami Mobile Banking

Dubai Islamic Bank has launched Al Islami Mobile Banking, which provides various secure and banking services round-the-clock, through a customized mobile-based website.

Customers will be able to check their account and card statements and details, including Murhaba accounts, investment accounts and funds. Customers can also open an investment account, request a chequebook, and issue or cancel a card through this service, said DIB.

Additionally, customers can make payments and fund transfers to any predefined beneficiary, while registering for additional eChannel services, such as SMS and phone banking and eStatements.

Musabbah Al Qaizi, head of electronic banking services department at Dubai Islamic Bank, said: "Al Islami Mobile Banking is leveraged on the existing Al Islami Online Banking service which has been a great success since its launch in November 2009. DIB customers can now conduct all their daily banking needs without worrying about branch opening hours or carrying a laptop with them. It all can be done using mobile

Jerome Kerviel: Societe Generale knew of fake trades in 2005

Jerome Kerviel, the former Societe Generale trader on trial for abuse of trust, computer hacking and faking documents, has told a French court that his firm was aware of what he was doing.

His actions eventually led to a €4.9 billion ($5.9 billion) loss for the bank, but Kerviel said he had "hid nothing" from Societe Generale when he first began fabricating hedging trades in 2005, reports Bloomberg.

He stated that he was also allowed to exceed daily trading limits "70 per cent of the time".

But Jean-Pierre Mustier, the former head of Societe Generale's corporate and investment banking division, stated that he did not know who Kerviel was until he was arrested and was unaware that the unauthorized trades were occurring.

"He can't say that management knew," Mr Mustier said. "Jerome Kerviel is the trader who lost the most money in the world."

Mr Kerviel's actions were discovered in early 2008 and later that year Societe Generale was fined €4 million for allowing the trading losses to occur.

Scotiabank launches ‘Scotia Mobile’ in Barbados

Scotiabank has launched Scotia Mobile Banking services to customers across the Caribbean including Barbados, the Bahamas and Trinidad & Tobago. Customers can now check their balances, transfer funds and pay bills from the convenience of their Internet-enabled mobile phone.

 

“We are thrilled that this week’s mobile banking launch allows Barbadians to manage one part of their busy lives with the touch of a button, at any time, from wherever they are,” said Kevin Teslyk, Managing Director, Scotiabank – Caribbean East. “With Scotia Mobile Banking, our customers will be able to perform their day-to-day banking quickly, efficiently and securely”.

 

Scotiabank’s introduction of mobile banking further demonstrates its commitment to offer innovative, convenient and secure banking solutions for customers. All mobile banking transactions are safe and secure, given that Scotia Mobile Banking operates on the same advanced security platform as Scotia OnLine Banking.

 

Scotia Mobile Banking customers with will be able to:

 

• Check account balances and transaction details
• View credit card and line of credit balances and payment information
• Pay bills
• Transfer funds between accounts

 

EU Parliament bids to stifle derivatives trading

The EU Economic and Monetary Affairs Committee has called for an outright ban on speculative trading in certain derivatives contracts and the imposition of higher capital requirements for firms handling contracts that are not cleared centrally.

In a resolution approved last week, the Committee says proposed EU rules on derivatives trading must be made clearer and tougher, so as to reduce speculative trading and ensure that as many derivatives as possible are traded through open channels that are subject to standards.

The Committee resolution advocates "abandoning the misjudgment that derivatives need no further regulation because they are only used by expert financial professions". Instead, it calls for strict rules to prevent inexperienced users and speculators from building up dangerous levels of risk and a total ban on speculative credit default swap (CDS) trading,

The resolution calls on the Commission to study ways to significantly reduce the overall volume of derivatives traded. It also backs proposed rules that would impose higher capital requirements on financial institutions involved in bilateral derivative contracts which are not cleared centrally, but suggests that such requirements may be waived if the clearing system used is deemed strong. It also proposes granting regulators the power to impose trading position limits, so as to counter "unsustainable levels of speculation".

The Committee urges that future EU legislation should include rules banning purely speculative trading in commodities and agricultural products. Upper risk limits should be considered for trade in agricultural products and in each specific commodity, including greenhouse gas emission allowances, so as to reduce speculation and help these markets to function transparently, adds the resolution.

On central clearing, the resolution stresses that CCPs must not be organised wholly by users and that their risk management systems must not be in competition with each other. Neither should market players have a controlling influence on CCP governance and risk management.

Namibian central bank limits value on cheques to N$500,000

The Bank of Namibia has announced a new limit on the value of cheques, as part of an initiative to reduce payment risk. The new N$500,000 limit on cheques within the National Payment System (NPS) became effective on 10 June. The central bank said that in line with this decision, no person will be allowed to split cheque payments into units of N$500,000 or less, if such multiple cheques are issued for the settlement of the same transaction. Businesses and the general public have been urged to consult with their banking institutions to determine how payments exceeding N$500,000 should be settled. Cheques that are issued for more than N$500,000 will also not be accepted from a Namibian account in payment of a Namibian account.

The Bankers Association of Namibia (BAN), which includes the four commercial banks, has advised customers as well as businesses to ask their bank to rather effect an electronic funds transfer or a bank credit transfer on their behalf.

BAN also emphasised the fact that the Bills for Collection service has additional costs attached to it and is subject to possible delays in final payment. “Special arrangements could be made to manually present the bill (cheque) for payment to the drawee bank; however such arrangements are also subject to the payee bank’s willingness to accept high value (bills) cheques for collection manually. It is therefore recommended that this collection process be availed on an exceptional basis only,” said BAN president, Ian Leyenaar. He added that the changes to the NPS required significant system changes in the banking industry as the country move towards clearing funds under a “real-time” system for amounts in excess of N$500,000. “We encourage individuals and clients to review their particular position without delay and discuss any concerns or questions they may have with their banking institution. It is also recommended that, if possible, the new procedures, if any, be implemented as soon as possible,” said Leyenaar. The BAN president said the banking industry hope to reduce some of the risks that both clients and the banks face with regard to the process of making payments.

Swiss Parliament recommends UBS accounts be handed to US

A Swiss Parliamentary committee has recommended that UBS hand over details of account holders to settle a potential law suit against the bank. The accounts belong to almost 4,500 US UBS customers suspected of using the bank to avoid paying tax.

Reports claim that the lower house of the Swiss Parliament is due to hold a debate while some commentators have also called for a public referendum on the matter, which would see Swiss secrecy laws changed if the accounts were to be published.

A referendum is expected to delay a potential agreement being made by several months.

Simonetta Sommaruga, a Social Democratic lawmaker said: “The fact is that if UBS has a problem, Switzerland has a problem too.

“That’s why we have to help out UBS with this settlement. A rejection would cause considerable damage to the economy.”

The US authorities launched legal action against UBS during February of 2009, claiming that the bank had helped as many as 50,000 clients avoid paying tax through its accounting system.

However, the government agreed to abandon suing UBS in return for the disclosure of the details of a number of clients.

Bank Operations - HSBC managers now talk to customers via webcam

HSBC has introduced a new consultation service that allows Premier customers in Hong Kong to hold virtual meetings with the company managers online. Customers are able to get access to the Live Connect service through the bank's Web site, clicking on a button to open a window containing a real-time view of their relationship manager.

Speaking to the managers via a webcam and computer speakers consumers can ask their questions and get instant financial advice on products.

While at the initial stage the service is being launched for Premier customers, eventually it will be extended to all sites in Hong Kong by the year end.

HSBC also launched Let US Call You service that allows customers leave their request online and be recalled immediately by the bank representative who will speak the language specified by a consumers on the website.

Credit agency regulator proposed by EU

The European Union (EU) has proposed the creation of a new regulator to monitor the actions of credit rating agencies within the eurozone.

According to reports, the new European Securities and Markets Authority would have oversight for agencies operating within the territory as well as offices outside the EU. The step follows criticism leveled at agencies, which suggested the current debt crisis within the EU has been worsened by their grading.

A second piece of proposed legislation calls for an overhaul of the way banks are managed, which included analyzing how corporate boards are established and remuneration processes for top bankers.

Michel Barnier, EU financial services commissioner, said: “The changes to rules on credit rating agencies will mean better supervision and increased transparency in this crucial sector.

“But they are only a first step. We are looking at this market in more detail.”

The new agency would see national bodies transfer their supervisory powers to it under the terms set out by the EU.

Heads of member states are expected to discuss financial regulation when they meet at the G20 summit in Canada later on in June.

Remittances - MoneyGram expands in Nigeria

MoneyGram International has announced that it will provide money transfer services at more than 500 First Bank of Nigeria locations across the west African nation. The agreement with First Bank of Nigeria PLC expands MoneyGram's presence in Nigeria, which dates to 1998.

First Bank, established in 1894, is Nigeria's oldest bank, with one of Nigeria's largest networks, MoneyGram said.

Nigeria, Africa's most populous nation, is ranked among the world's top 10 receiving countries for money transfers, MoneyGram said. The World Bank estimates that $10 billion in remittances was sent to Nigeria last year, with the U.S. the primary sending country.

Nigeria is widely recognized as the country of origin of many e-mail scams and financial fraud operations involving money transfers.

Company spokeswoman Lori Burzynski said MoneyGram data show that less than one-half of 1 percent of the company's total transactions represent third-party fraud. She said MoneyGram has committed "significant resources to building a state-of-the-art consumer anti-fraud program, and we continue to improve the program."

Operations Risk: Ex- Bank of America call centre worker pleads guilty to selling client details

A call centre worker formerly employed by Bank of America (BoFA) Merrill Lynch has pleaded guilty to stealing and subsequently attempting to sell customer details.

According to court records, Brian Hagen recorded information of accounts at a call centre in Florida where he was employed. The former BoFA staff member is believed to have taken details of the bank’s clients including names, addresses and birth dates.

Mr Hagen was caught out after he met with undercover agents from the Federal Bureau of Investigation, whom he thought were looking to source data on individuals with a high-net worth.

The ex-employee thought he may take as much as 25 per cent of the proceeds of the scam, the court documents showed.

However, Adam Allen, the defendant’s attorney, said: “Mr Hagen has worked in the banking industry since he was 17 years old and the conduct in this case constitutes an isolated incident for which Brian deeply regrets.”

Although the defendant could face a maximum of 30 years in prison and a $1 million fine, his guilty plea is expected to reduce the size of his potential punishment.

Citibank launches contactless payments stickers

US banking giant Citibank has begun offering customers contactless payments stickers that can be attached to the back of mobile phones.

Citi has quietly rolled out the option for customers who request it via the bank's Web site, using the tag-line: "The back of your phone just became its coolest feature".

The Citi payment tags, enable customers to make payments of up to $50 at the point of sale at MasterCard PayPass readers.

It is linked to customers' Citi credit card accounts with purchases appearing on monthly statements.

SEPA migration deadlines: Possible end dates floated

With SEPA-compliant transaction volumes still weak, Harcus Cooper of Barclays is forecasting the introduction of phased end-dates for mandatory conversion to the new EU-wide payment instruments, with credit transfers expected to get the nod in 2013 and direct debits by 2015.

The SCT scheme was introduced in early 2008, yet, according to ECB figures, two years later it accounted for just 7.5% of credit transfers in the Euro area. SDD take-up has been equally sluggish - at the recent EBAday it was noted that a paltry 200 SDD transactions per day, globally, go through EBA Clearing.

Cooper, who is Barclays' senior product manager on SEPA, was speaking at a payments event in London. He noted that many corporates are having trouble justifying the business case for SEPA in the absence of a firm migration deadline away from legacy infrastructure.

The Experian event takes place just a week after the European Commission and European Central Bank hosted the first meeting of the SEPA Council, a new body created to guide the future development of the project which has been dogged with criticism.

The meeting is understood to have seen broad consensus reached that January 2013 would be a likely end date for credit transfers with direct debits following in 2015.

It has long been acknowledged that deadlines are necessary. Last March ECB executive board member Gertrude Tumpel-Gugerell warned: "We need a migration end date from which on onwards only the European payment instruments will exist. We all know that it is inefficient and costly if two schemes continue to run in parallel for a prolonged period of time".

After talks with stakeholders last year saw widespread support for deadlines, the move appeared to gain impetus, with the EC initiating talks with member states in November yet final dates have still not been set.

Jerome Kerviel trial begins in Paris

The trial of 'rogue trader' Jerome Kerviel has got underway in Paris on Tuesday. Mr Kerviel is accused of losing his former bank Societe Generale around €4.5 billion ($5.36 billion) through unauthorized trades he made.

The firm says that Mr Kerviel made these trades without its knowledge and covered his tracks by inventing fictitious transactions.

However, the trader states that Societe Generale was aware of what he was doing and actively supported his actions until the deals became public knowledge, reports the Guardian.

"I was wrong and committed errors, faults even, but I was serious and efficient at work and the fact my bosses protected me and I was promoted during my short career shows this," he said in a recently-published book.

If he is found guilty, Mr Kerviel may be given a jail sentence of five years.

In 2008, Societe Generale was fined €4 million for its role in allowing the trading losses to take place.

Filipinos in Canada swindled out of remittance money

Filipinos who sent money through a remittance center discovered that they had been cheated out of their money. An estimated Can$100,000 worth of remittances never reached their intended recipients in the Philippines.

Ofelia Hermosa is a victim of a remittance company which allegedly stole money she gave them to send back home. Hermosa used the maximum limit on her credit cards just to raise more than Can$8,000 to send to her ailing mother. Being a patron of “Jak En Poy”, she sent her money through the store.

Several days later, she found out that her mother still had not received anything. When she confronted the owners, they blamed their agent in the Philippines who allegedly ran off with all the other remittances.

Albert Quidalos, who also lost more than Can$1,000 to Jak En Poy, estimates that about 90 other Filipinos got promissory notes from owners Danny and Irene Ongkeko. He said Danny Ongkeko assured him, he would return the money. But when Quidalos went back to the agency, he discovered the store has already changed its name and now has new owners.

Quidalos and Hermosa are asking other victims to join them in filing charges against the Ongkekos. But Gina Oliveros, a contract worker in Langley, British Columbia, said she cannot afford lawyer’s fees.

Another victim, Leopold Dallo also hopes that the Ongkekos will hear their pleas and return the money.

But Ed Gloriani, who lost Can $2,500, is taking action against the couple. He asked a relative in the Philippine National Police to track down the Ongkekos, who are believed to have gone back home in the Philippines to hide from their claimants here.

Documents reveal that as early as November 2009, Danny Ongkeko had already filed for bankruptcy, which when approved, will make it harder for their victims to get their money back.

Kenya' April remittances up slightly: Central Bank

Kenyan remittances rose slightly to $52.68 million in April from $52.31 million a month earlier, and were up from $48.12 million in the same month last year, the Central Bank of Kenya said this week.

"The pick up in April ... can indirectly be attributed to improving economic conditions in the regions of origin, and improved prospects for economic recovery at home," the bank said in a statement.

The central bank said the main source of the money remained North America followed by Europe.

Typically, Kenyans living abroad send money back home to help their families and to invest in various sectors like real estate.

They sent a total of $609 million last year, down from $611 million in 2008. Remittances rank among the country's top sources of foreign exchange alongside tourism, tea and horticulture.

Mobile banking - iPhone and iPad offer the possibility of Money transfers via MasterCard

MasterCard has launched its MasterCard MoneySend service for iPhone and iPad owners to allow them transfer money in the United States from from iPhone or iPad's. MasterCard MoneySend is now available for free download at the iPhone App Store.

Using MasterCard MoneySend option customers in the US can initiate or request money transfer via their iPhone with participating banks and credit unions, or when they create a virtual prepaid account through Bancorp Bank that is linked to an existing MasterCard payment card or checking account.

Registered MoneySend users have the ability to:

• Accept credit or debit card payments
• Send money to family members 
• Pay for informal goods and services 
• Request money from people who owe you money
• Simplify business or non-profit collection effort the Request Funds feature
• Manage MoneySend transaction history from an iPhone or iPad.

EU Court of Justice shows only national Internet gambling firms can be licensed

The European Union Court of Justice (ECJ) has released the rulings on the two cases this week which indicate that EU countries can impose bans on online gambling companies if their aim is to combat fraud. The rulings brought by the ECJ are related to the cases considered by lower courts in the Netherlands.

British bookmaker Ladbroke was taken to a Dutch court by De Lotto, a Dutch non-profit-making foundation which offers games of chance, who asked the injunction on the UK firm’s online gambling operations on the grounds they are not licensed in the Netherlands.

Ladbrokes appealed to the Dutch Supreme Court after the lower court backed De Lotto. And the Dutch Supreme Court asked the ECJ in 2008 to rule whether the Dutch licensing system was compatible with EU law allowing for the free movement of goods and services across the 27-country European Union.

Another case was brought by Betfair, the world's largest online gaming exchange, who disputed the Dutch authorities’ decision to decline a license while they had granted similar licenses to two Dutch companies. The court again sought guidance from the ECJ.

The ECJ backed the position of the lower Dutch court on Ladbrokes.

"Such a restriction may be justified, in particular, by the objectives of consumer protection and the prevention of both fraud and incitement to squander money on gambling, as well as the need to preserve public order," it said. It cited the same rationale for the Betfair case.

"The grant to such an operator of exclusive rights to operate games of chance, or the renewal of such rights, without any competitive tendering procedure would not appear to be disproportionate in the light of the objectives pursued by the Netherlands legislation," it said.

Consultancy H2 Gambling Capital estimates the European interactive market could be worth as much as 12.6 billion euros ($15.50 billion) by 2012, up from 8.3 billion euros last year.

Remittances - Andhra Bank links with UAE Exchange Centre for faster service

Public sector lender, Andhra Bank has entered into an agreement with UAE Exchange Centre of Kuwait in order to bring up a special scheme which would facilitate speedy remittances to its customers.

The service would allow NRI customers to remit money from any of the UAE Exchange Centres located in Kuwait. This money would be credited to the accounts of Andhra Bank customers across all 1,560 branches of the bank in India. The amount would be credited the next day after being remitted.

An SMS alert would be generated to the beneficiaries in India confirming that the amount has been credited to their account, the bank said.

Payments – New SEPA Council aims to kickstart EU payments convergence

The European Commission and European Central bank have hosted the first meeting of the SEPA Council, a new body created to guide the future development of the Single Euro Payments Area project. The meeting brought together top-level representatives - both users and suppliers in the European payments market.

Participants from the users side included consumers, retailers, businesses/corporates, small and medium-sized companies, and national public administrations. Payment supplier representation comes from the European Payments Council (EPC), co-operative banks, saving banks, commercial banks, and payment institutions. In addition, four national central bank board members represent the Eurosystem.

The establishment of the new body follows strong criticism of the SEPA governance structure and the lack of consultation with end-users. At the EBAday meeting in Luxembourg earlier this month, banks too expressed their concerns about the expense of the project, its sluggish returns and the failure of national governments to support the scheme.

Internal market commissioner Michel Barnier describes the formation of the Council as "a crucial step forwards" in the realization of an integrated market for payments in euro.

"To achieve the full potential of SEPA, we clearly need to improve user involvement in this project, both from early design to final implementation," he says. "I very much hope that this new Council will act as a catalyst to create a retail payment framework fully meeting the expectations of all actors."

The main issues discussed at the first meeting were the need and conditions to establish migration end-dates for SEPA and the future of a SEPA for payment cards. The Council will meet twice a year for an initial period of three years, say the ECB and the Commission, who will monitor and evaluate its progress over time.

Gertrude Tumpel-Gugerell, ECB executive board member, says the Council will not displace the bank-backed co-ordinating body, the EPC.

"We need to recognize the importance of user involvement for the success of SEPA," she says. "The SEPA Council aims at bringing together, at the highest level, the demand and supply sides of the European payments market, without, however, replacing any of the existing bodies, such as the European Payments Council."

Kenyan government salute to remittances

The Kenyan government recognizes the contribution by close to 2.5 million Kenyans in the Diaspora towards the country's economic growth through their remittance, Vice President Kalonzo Musyoka has said.

Mr. Musyoka noted that in 2008-2009 financial year Kenyans living and working abroad remitted over $1billion to the country.

He said the government will continue to engage her citizens abroad in various fields as they were only contributors to the country's economic growth but also they are ambassadors who play a crucial role of boosting positive image internationally.

The Vice President made the remarks on Monday when he opened the first conference of Kenya's honorary consuls abroad, at the Windsor Hotel Nairobi.

The conference whose theme is "New Dimensions in Kenya's Diplomacy: the role of the Kenya's consuls is aimed at appraising the officials with the country's foreign policy priorities and their role in actualizing them.

Mr. Musyoka said the adoption of the proposed constitution will open doors for the country to expand its bilateral relations with the rest of the world for the benefit of her people.

He said the new law will allow for dual citizenship, thus creating the right environment for the Diaspora to increase its remittances and investments

On tourism and foreign investments, Mr. Musyoka added, the draft proposes the devolution of funds thus opening up the rural areas for business and development.

The Vice President said the government was in the process of producing a written foreign policy in which core priorities and objectives such as promoting economic development, enhancing regional peace and security with interlinked pillars of diplomacy will be outlined. He however, noted that due to financial and economic limitations, the government has adopted a strategy of expanding Honorary Consular representation abroad to conduct Kenya's diplomatic interests.

The Minister of Foreign Affairs (MFA) Moses Wetangula commended the honorary consuls for offering to represent Kenya abroad, citing Australia where there are many Kenyans studying and working. He assured that the government will support all the efforts by honorary consuls in their tasks as country's representatives.

Mr. Wetangula assured them that they will be introduced to the key players in the Kenya economy and the role they can play in the vision 2030.

The Dean of Honorary Consuls, Mr.Jens Peter Breitengross of Hamburg, Germany urged the ministry to keep them informed of the changes that are taking place in Kenya.

Operations Risk - Royal Bank of Scotland loses £93,000 in simple cash deposit scam

A businessman conned the Royal Bank of Scotland out of £93,000 in a absurdly simple scam that exploited the bank's cash envelope deposit system.

Senthuran Gopalakrishnan was jailed for one-year for the fraud in which he pretended to deposit £155,000 over an eight-day period, when in fact he had only banked £62,000. The bank's Fast Cash deposit system required customers to place the cash in a sealed envelope and write down the total on the cover. This sum was immediately credited to customer accounts.

At a hearing, Gopalakrishnan admitted that between 29 June and 6 July last year he deposited a number of envelopes which contained inflated details of the amounts of cash inside, netting a cool £93,000 windfall.

The fraud was only uncovered five days later when a different department counted the actual sums in the envelopes. The £93,000 excess withdrawn by Gopalakrishnan was never recovered.

The bank says it has since changed the system.

Operations Risk - Romanian police bust ATM skimming factory

Romanian police have detained 20 members of a gang accused of manufacturing and selling ATM skimmers. According to local press reports, police raided 38 locations in Craiova, six in Bucharest and three in a neighboring county.

Those detained face accusations of being members of an organised crime group, unauthorized access to a computer system, possessing card-cloning equipment, access device fraud and distributing fake electronic-payment devices.

The skimmers were either sold to other criminal gangs or used by ring members in Italy, Germany, Sweden and Romania, say authorities.

Meanwhile, reports also claim that the Romanian Directorate for Investigating Organized Crime and Terrorism has arrested five fraudsters allegedly part of a card cloning gang.

Contactless payments - New York and New Jersey run transit trial

MasterCard has teamed with local transport agencies in New York and New Jersey on a six month contactless payments trial that will see participants able to pay for train and bus journeys by tapping their cards against specially-equipped readers.

MasterCard is working with the Metropolitan Transportation Authority (MTA), Port Authority of New York and New Jersey (PATH) and NJ Transit (NJT) on the pilot program, which will begin on 1 June, covering select train and bus routes throughout New York and New Jersey.

The pilot - an extension of a 2006 trial launched in 2006 by MasterCard, MTA and Citi - sees MasterCard PayPass readers installed on select turnstiles and fare boxes along various routes.

Using their MasterCard PayPass or other contactless payment-enabled card or device, participants will be able to choose from a "Pre-Fund" or "Pay-As-You-Go" fare option. All fares purchased using a PayPass-enabled card or device will be automatically applied to customers' credit or debit accounts.

Remittances to Mexico register first increase since 2008

The amount of money sent home by Mexicans living abroad increased slightly in April for the first time in 17 months.

The Bank of Mexico says remittances for the month reached $1.8 million, less than a 1 percent increase over April 2009. The bank says no increases had been reported since November 2008. But it also noted in its report that remittances from January to April this year dropped to $6.6 million, nearly 9 percent less than the same year-ago period.

Remittances are Mexico's second-largest source of foreign income after oil exports. Nearly all of the money comes from the US, where nearly 12 million Mexicans live.

Recovery in the Gulf drives rise in remittances to Jordan

Economists expect remittances from Jordanians working abroad, mainly in the Gulf region, to continue to increase steadily this year.

According to figures recently published by the Central Bank of Jordan (CBJ), expatriate transfers during the first four months of 2010 rose by 2.4 per cent reaching JD797.7 million ($1.1 billion) compared with JD779 million during the same period last year.

Foreign remittances represent approximately 20 per cent of Jordan’s gross domestic product.

CBJ figures showed that remittances during April of this year increased by 6.7 per cent compared to the same month in 2009 from JD195 million to JD208 million.

Economist Hani Khalili said that the rise in money transfers from abroad indicates that either the number of Jordanians working in the Gulf region has increased or that workers’ income have gone up.

“I believe that the number of Jordanians working in the Gulf has increased because the economies of these countries are recovering and they tend to attract more skilled labor,” Khalili said, adding that Jordanians are among the most wanted skilled workers in the Gulf.

Fahmi Abu Dayeh, chief economist at a local bank, said that the volume of remittances is returning to its usual levels from previous years, noting that the drop in remittances in 2009 was temporary, due to repercussions of the global economic downturn.

“I expect remittances to continue growing in the coming years as higher oil prices have spurred recovery in the Gulf region,” he said.

Economist Ali Tabbalat agreed, but cautioned that “remittances are expected to rise steadily but not dramatically”.

The Gulf private sector is looking for qualified and skilled staff, and many Jordanians are heading to work in the oil-rich region, particularly in Saudi Arabia, Tabbalat added.

Economists agreed that last year analysts overestimated the effects of the global downturn when they predicted that many Jordanians working in the Gulf would be laid off.

Abu Dayeh said that lay-offs in the Gulf were primarily among Asians who often work as unskilled laborers in construction projects, whereas Jordanians work in more specialized fields such as engineering, medicine and academia.

Tabbalat said that the majority of Jordanians who left work in the Gulf were working in Dubai, as the emirate was hardest hit by the global financial crisis, agreeing that the number of those who were sacked was “very limited”.

According to official figures, over 600,000 Jordanians work abroad, mainly in the Gulf countries, of whom 260,000 work in Saudi Arabia, 250,000 in the United Arab Emirates, 42,000 in Kuwait and 27,000 in Qatar.

Remittances - Hard times in Greece prompt Albanians to return home

After the fall of Communism two decades ago, Greece became a promised land for hundreds of thousands of Albanians, a place to make a new start after generations of grinding poverty. But the gold rush has fadeed and many migrants are now finding themselves to be the first victims of the Greek financial crisis. Some see better economic prospects in Albania and are tempted to return home for good.

"I have never seen the economy so bad," said Agim Aliaj, a 48-year-old house painter who returned to Albania in March, after failing to find regular work in Greece for months.

"It has been impossible for me to send money home for a year and a half. Their problems will affect us, too, very hard."

Albanians are by far the largest groups of foreign workers in Greece, estimated at 650,000 to 800,000, and have been among the first to feel the current turmoil.

Since the onset of the global financial crisis, the woes of Albanian migrant workers in Greece and Italy, Western Europe and the United States have been reflected in the decline of their remittances, which sank to a five-year low last year.

In 2009 remittances totaled 780 million euros, equivalent to nine percent of Albania's gross domestic product. That compared to totals of 833 million euros in 2008 and 951 million euros in 2007, the highest figure ever.

Remittances would fall further and unemployment could rise if the number of returning migrants continues to grow. On the positive side, some may also bring back capital to invest.

Aliaj, the house painter, said thousands of Albanians were struggling just to get by in Greece, hoping the economy would improve. Their families from Albania were sending them tobacco, beans and potatoes via buses plying the slow, tortuous mountain route.

Like many others, he was tempted to stay home and cultivate land in his village Kuc, where his wife, daughter and son live.

But he was quickly sobered by the experience of his fellow villagers, who saw tons of their onions, beans and apples dumped into a river for lack of a proper market or storage.

"This gives me no enthusiasm to start an activity because the sale is not guaranteed. I will wait for a few months to see how things are in Greece and will go back there," he said.

Unlike Aliaj, Gerald Hoxha, 28, has returned home to his native village for good.

"Once my daughter finishes first grade (in the coming days), all the family will come here to settle for good. There is some work here for me, not much, but it will be better than in Greece," Hoxha said.

Having worked mostly as iron worker, including for the 2004 Olympic Games, Hoxha said he had seen his daily income fall from 70 euros to as low as 30 euros when he could find work to support a wife, seven-year old daughter and three-year old son.

"If I worked 24 days a month for 50 euros a day, it would be fine. But in the last four months of winter I could work only 20 days. And I think it will be much worse in September," Hoxha said, adding nobody was keen to build there anymore.

At the Kapshtice border crossing with Greece, duty officer Landi Ipo said the number of Albanians returning for good had increased as migrants were leaving the Thessaloniki area.

There are no reliable statistics on the number of Albanians that are returning home from Greece. Greek officials acknowledge that an increasing number of Albanians are leaving but say it is too soon to speak of a major wave of departures.

"They say they have no guarantees for the future there. They are coming back with everything they own," Ipo said.

Driving his Opel car past the Kapshtice border crossing into Albania, Arben Haka said he hoped to find something to do here because life was becoming too hard for a migrant worker.

"I am hopeful I will find something in my country, because the foreign land is no longer able to keep us," he said.

Although Albania remains one of Europe's poorest countries, with unemployment officially at more than 14 percent, the Greek crisis has prompted some thinking among the migrants.

Per capita GDP in Albania stood at $3,840 annually in 2008, compared to $29,361 in Greece, according to the World Bank.

Albania is one of the few European countries that did not go into recession. Gross domestic product (GDP) rose by 3.3 percent in 2009, down from 7.9 percent the year before, and is seen growing again in 2010.

"Why does our government force us to pick the cherries of the Greeks instead of providing us with development alternatives," Aliaj asked. "Albanians have toiled and sweated in Greece. If they had stayed at home, if the right policies had been in place, something great would have been achieved."

Operational Risk - Risk Management IT Set for Increased Spending

Financial institutions worldwide will increase spending on technology related to risk management, according to three new reports released by Chartis Research. The spending increase is, in part, attributable to financial institutions' responses to the financial crisis, regulatory changes and a desire to combat financial crime.

"Financial institutions realise they must continue to invest in strong risk management IT systems," says Peyman Mestchian, managing partner at London-based Chartis. "One of the main lessons learned from the financial crisis was that risk management systems weren't up to the job."

Chartis' research reveals the key areas in risk management IT where financial services firms will continue to invest. The three new Chartis reports, "Financial Crime Risk Management Systems 2010", "Market for Solvency II Technology 2010" and "Market Risk Technology Solutions 2010" provide in-depth discussions of these markets and forecast how and where growth in IT spending will occur. The Chartis reports also identify demand-side trends, best practices, leading software vendors and competitive landscapes. They can be downloaded at www.chartis-research.com.

"Financial Crime Risk Management Systems 2010" gives a detailed account of the increase in the occurrence and complexity of financial crime and predicts that the global recession will increase the frequency of internal fraud, security breaches and false accounting. Financial services firms, according to the report, are particularly troubled by insider fraud, because of the reputational damage it brings. The paper also discusses the proliferation of identity theft and Internet-based frauds, like phishing, which are impacting financial services firms. Accordingly, firms are devoting more resources to fighting all kinds of fraud. Chartis forecasts the global market for financial crime risk management technology will grow to $4.19 billion by 2013, at a compound annual growth rate of 15%.

"Market for Solvency II Technology 2010" forecasts that expenditure will grow to $1.67 billion by 2013 at a compound annual growth rate of 19.2%. "The rate of growth reflects the growing cost and complexity of implementing Solvency II technology projects," says Mestchian, "For example, hiring and retaining staff able to manage sophisticated Solvency II projects has become a greater cost than anticipated."

"Market Risk Technology Solutions 2010" forecasts the global spend for market risk software and technology will be $1.28 billion in 2010 growing to $1.8 billion by 2014, reflecting a compound annual growth rate of 8.9%. "The EMEA region represents most of the spend this year, however, Asia Pacific will provide most of the growth over the next five years," says Chartis' Mestchian.

Mobile phones and banks, banking transactions future trends

Futurist Dr Patrick Dixon shares some ideas and concepts. Should banks be worried? Judge for yourself.

Remittance inflows to Kenya drop because of Euro problems

Remittances from the Kenyan diaspora will maintain a downward trend as the debt crisis spreads among European nations, market analysts have said.

“There has been a significant drop in remittances from the European area in the last few months, we don’t know when the trend will reverse,” said Frida Nzilani of Sky Forex Bureau.

Europe, which accounts for 27 per cent of the total remittances from Kenyans working abroad, is reeling under the weight of huge domestic debts.

“Investment instruments like mortgages are going to be affected due to reduction in incomes and job losses”, said Mr. Karisa Yaa, treasury manager at Kenya Commercial Bank.

An earlier report by the Central Bank had indicated a decline of three per cent, but market analysts warn the trend may dive further even as most Euro zone nations adopt austerity measures to curtail spending hence shrinking growth.

“Economies already in a crisis like Greece, Spain and Britain will see taxes hiked, an issue that will prompt layoffs and salary cuts” said Mr. Chris Muiga, a trader with Kenya Commercial Bank in an interview with the Business Daily.

“The decline of Greece into her current economic woes has sent jitters across the Euro zone creating a lull in what would have been otherwise a resurgent economic growth, ” said Karisa.

Kenya has been experiencing growth in the value of remittances from the diaspora for the last five years owing to the increasing number of skilled Kenyans abroad. They were, however, hit by the last global financial crisis, a resurgent upward trend has again come under pressure from the euro zone debt crisis.

The annual aggregate figures have maintained a steady upward trend from $338 million in 2004 to $609 million in 2009 except between 2008 and 2009 when there was a lag arising from the global financial crisis.

The decrease in remittances from $611 million in 2008 down to $609 million in 2009, a three per cent decline, arose from job losses and the liquidity crisis occasioned by the subprime mortgage crisis that hit Europe and North America.

Industry players attributed the persistent long run increase in cash inflows to the increasing number of Kenyans looking for employment abroad.

Philippine remittances rise 7% to $4.34 billion in March

Remittances grew seven percent year-on-year in the first three months of the year to $4.34 billion, the central bank (Bangko Sentral ng Pilipinas (BSP)) reported today.

For the month of March, overseas Filipinos sent home $1.55 billion, up from $1.41 billion in February. It was also 5.44 percent higher compared to March 2009 of $1.47 billion. BSP said remittances from land-based and sea-based workers increased by six percent and 11 percent, respectively.

In a statement, BSP Governor Amando M. Tetangco Jr. said prospects for more Filipinos finding more work abroad is "positive" in the next months, particularly in Hong Kong, Qatar, Taiwan, Kuwait, United Arab Emirates and Saudi Arabia.

Tetangco said employment opportunities "are expected to rise along with clearer signs of global economic recovery." He quoted a report from the Philippine Overseas Employment Administration that in the first quarter this year, job orders totaled 155,334, of which 20.2 percent or 45,393 were job orders for service, professional, technical, and production-related work.

Tetangco also attributed banks expanded remittance network in the continued expansion of fund transfer volume. As of the end of March, the BSP noted that these networks increased to 4,483 from end-2009 of 4,192. These networks include tieups, remittance centers and local banks representative offices or branches abroad.

BSP earlier increased its remittances forecast to eight percent this year, from six percent. In dollar terms, remittances are expected to amount to $18.7 billion this year from $17.3 billion at the end of 2009. The previous projection was six percent or $18.35 billion.

Mobile Banking – Re-launch of ZPESA in Zanzibar

Zantel has the re-launched its mobile banking service ZPesa for its customers in Zanzibar in an effort to revamp its mobile banking services by adding more services that are people-centric.

Zantel was the first mobile company in Tanzania to launch mobile banking services three years ago and has spread throughout the country.

Zantel Chief Executive, Noel Herrity said that the new rebranded ZPesa service with additional services will enable Zantel subscribers in Zanzibar to pay for various utility bills. Some of the utilities which have partnered with Zantel are electricity, water, DSTV and cable TV, and the purchase of airtime. This is in addition to the sending and receiving of money.

He said that the company is constantly enhancing the ZPesa service by signing agreements with other service providers that deliver value in order to enable Zantel customers pay bills and do other payments via their mobile phones..

He reiterated the importance of bringing banking services closer to the reach of majority of the population who are unbanked but have access to mobile phones.

"We are known for being an innovative brand that is always striving to enable Tanzanians to access affordable means of communication and in this case quick and reliable banking services to all our subscribers especially those that do not have access to banking services," said Mr. Herrity.

The ZPesa relaunch exercise has also been integrated with the SIM card registration exercise to enable more Zantel subscribers to register their numbers before the end of June deadline.

Zantel subscribers who register for ZPesa services will have automatically registered their numbers and are entitled to receive bonuses which they can redeem either as cash or as airtime at any ZPesa cash points and outlets, he said. He said that the redeemable amount in cash is 300Sh or 1,000 Sh worth of airtime.

According to Zantel Chief Commercial Officer Norman Moyo Zantel has engaged a lot of businesses, organizations and societies in Zanzibar and across the country who have membership in different parts of the country to be ZPesa vendors and agents.

"Zantel is empowering local businesses to get productive through appointing and equipping them to work as vendors or agents and in turn increase their income and allow them to expand their services to untapped areas," he said.

Operational Risk - SEC proposes consolidated audit trail system to better track market trades

The Securities and Exchange Commission has proposed a new rule that would require the self-regulatory organizations (SROs) to establish a consolidated audit trail system that would enable regulators to track information related to trading orders received and executed across the securities markets.

A consolidated audit trail system would help regulators keep pace with new technology and trading patterns in the markets. Currently, there is no single database of comprehensive and readily accessible data regarding orders and executions. Stock market regulators tracking suspicious market activity or reconstructing an unusual event must obtain and merge an immense volume of disparate data from a number of different markets and market participants. Regulators are seeking more efficient access to data through a far more robust and effective cross-market order and execution tracking system.

“If adopted, this consolidated audit trail would, for the first time ever, allow the SEC and other market regulators to track trade data across multiple markets, products and participants in real time,” said SEC Chairman Mary L. Schapiro. “It would allow us to rapidly reconstruct trading activity and quickly analyze both suspicious trading behavior and unusual market events.”

Last year, the SEC set up an agency-wide task force to carry out the audit trail initiative and begin the process of developing the rulemaking proposal recommended to the Commission today.

The SEC’s proposal seeks public comment and data on a broad range of issues relating to a consolidated audit trail. Public comments on the proposal should be received by the Commission within 60 days of its publication in the Federal Register.

Operations Risk - The end of the fax?

The US Commodity Futures Trading Commission is ready to bin the fax as it tries to get to grip with tech-driven markets

The US Commodity Futures Trading Commission is to establish a technology advisory committee after admitting that it struggles to keep pace with technological advances and that it continues to use faxes and manual entry forms for reviewing trading account data.

In a statement, CFTC Commissioner Scott O'Malia said the agency will vote to re-establish the CFTC Technology Advisory Committee. The Committee - which will include representatives from academia, exchanges, clearinghouses, trade repositories, and other groups - will hold its first hearing on July 14 to discuss high-frequency trading. Other issues on the agenda will be co-location, trade repositories, surveillance and security systems, and swap execution facilities.

In a surprisingly frank assessment of the CFTC's own lack of technological savvy, O'Malia said that regulatory bodies must understand and embrace technology in order to be truly effective.

"Unfortunately, here at the Commission, we struggle to keep pace with technological advances as we continue to receive account data via facsimile and enter that data manually," he said.

With Congress expected to provide new authorities to the Commission oversee the OTC market, O'Malia said the agency is about to be hit with a "tsunami" of trade data.

"The fax machine will not provide any assistance whatsoever," he said. "We must do a better job to automate all our forms and systems to handle the massive volume of trade data that will be sent to the Commission."

Stolen HSBC data tapped for Italian tax evasion probe

Italian police have launched a tax evasion investigation based on data stolen from HSBC's Swiss private banking arm by an IT employee, after being given a list of around 7,000 account holders by French counterparts.

According to Bloomberg, a Turin-based court requested the Italian names on the list of 127,000 accounts belonging to 79,000 people, obtained by French authorities. Herve Falciani, an HSBC IT employee stole the data three years ago and fled to France while under investigation before eventually handing it over to authorities.

Last month French prosecutor Eric de Montgolfier revealed that the stolen files have been decrypted and launched a tax investigation based on over 8,000 accounts related to French customers.

The willingness of foreign tax authorities to pay for information relating to Swiss private bank accounts has been a growing source of diplomatic tension. In February German Chancellor Angela Merkel warned her government may buy stolen data on Swiss accounts.

PayPal launches Android mobile developer library as smartphone sales surge

PayPal has opened up its Mobile Payments Library - which lets developers add checkout functionality for physical goods and services to their apps - to Android users. This follows the launch last month of an equivalent library for iPhone handsets and is intended to help developers charge for goods and services sold through applications without having to collect and store debit or credit card information.

The eBay unit has also introduced a PayPal X Toolkit for Google App Engine, a platform for developing and running Web applications and services on the search engine outfit's cloud.

Recent data from Gartner found that Android devices surpassed iPhone sales for the first time in Q1 as smartphone sales to end users reached 54.3 million units, an increase of 48.7 per cent from the first quarter of 2009.

UK mobile money operation Monitise says it has seen a similar surge in the use of m-banking smartphone apps, processing 20 million enquiries and transactions in the last six months. Earlier this year Monitise unveiled a mobile money app for Android phones, available as a free download from the 'Android Market'.

Alastair Lukies, CEO, Monitise, says: "Smartphones are completely changing the face of mobile banking. A sea change is well underway in how people manage their day-to-day finances as they realise how simple, slick and fast mobile banking is - as easy as a few taps on a keypad."

Research house Forrester recently found that European BlackBerry and iPhone users are nearly three times more likely to use mobile banking services than the owners of other handsets.