The fallout of the demonetisation in India is badly affecting the cash transfers from Qatar to India. Money transfer businesses have been witnessing a substantial drop in the number of customers wishing to send money to India amid the ongoing cash crunch.
Expats from Qatar either use money exchanges or bank transfers to send money to India, bank transfers have become preferable for sending remittances to India whereas cash transfers have been badly hit.
“Instant cash transfers from services such as Western Union are currently witnessing a fall of about 20-25% business, the reason for this is that their offices in India do not have enough cash in possession to honour the transactions”, says Zubair Abdulrahimab, Operations Manager at Al Zaman Exchange.
It is because of this reason that expats in Qatar are facing problems if they wish to send money back to their families in India amid the cash crunch.
It is worth mentioning that recently Indian Govt. in a surprise move overnight declared currency notes of 500 and 1000 as illegal. As the country is currently scrambling to deal with the after effects of this move, people have complained about the insufficiency of liquid cash in the market and long serpentine queues outside cash machines has become a daily sight since November 8th.
Other currency exchange businesses have also stated that cash transfers have taken a hit due to the demonetisation.
Due to a scarcity of liquid cash in circulation in India, people who have no option send their remittances via cash, but the recipients back in India end up facing problems as they are only given cash of up to 4000 and the rest is given in the form of cheques.
The worst affected is the labourer class, who are heavily dependent on cash transfers as they find it convenient to send money to their families this way as not all villages in India have easy access to banks or ATMs. Families of blue-collar workers avail the services of instant cash businesses to get the remittances their loved ones send to them from Qatar.
“The village I come from in India is far away from the bank and I found it more convenient to just send money to my family through Western Union, however, since the demonetisation was announced by Modi my family is having a tough time, despite having money we cannot avail, this is stupidity, common people like myself are suffering”, said an Indian blue-collar worker.
People who use the instant cash services are generally doing so because of some urgency, but since the demonetisation the service has lost the unique selling point for which people availed it, making it tough for exchange houses.
Meanwhile, many Indian expats are delaying sending remittances to India as they expect a falling rupee to fall even further, the rupee recently hit a year low mark in comparison to the US$.