Michael Liu’s grandfather came to Australia from a rural area in China’s Guangdong province in 1948.
Working as a teacher, he wanted to escape the upcoming communist regime with its anti-intellectual bent.
He brought his son, Michael’s father, to Australia in the early 50s, but it took until 1964, before his wife, Michael’s grandmother, could come to Australia.
After 20 years working as an investment banker with Macquarie Group and UBS, the Sydney-based Michael Liu was recently appointed to head the Asia-Pacific operations of London-based online remittance company, WorldRemit, to help migrants like his family.
“My grandmother is now 95 and she tells me if we had a remittance service like WorldRemit, which does not have the ‘leakages’ of the old system of sending cash to China on boat, she would have been able to come to Australia earlier,” Liu says.
He adds it was the attraction of helping fellow migrant families that prompted him to leave his job in investment banking to head WorldRemit’s Australian-based operations this year.
“I was attracted to the idea of a service that helps migrants who have come from around the world to Australia,” Liu says.
“One in four Australians migrated here from overseas and one in two have a parent or parents born overseas like me,” he adds.
“But new migrants are often the unheard voices of Australia. They are often not provided with financial services due to cultural and language barriers.”
Established in London in 2010 by Ismail Ahmed, who was born in what is now called Somaliland (a self-declared state internationally recognised as an autonomous region of Somalia), WorldRemit is a global online remittance company taking on global giants like Western Union, offering almost instantaneous, low-cost international money transfers.
Australia’s growing migrant population has made it the second-largest growth market for WorldRemit since it began operating here in 2012.
Liu says the market is opening up with the withdrawal of traditional Australian banks from the remittance business, which typically involves smaller sums of money sent by low-income clients to their even poorer relatives offshore.
Increasing regulation of international money transfers by Austrac has also discouraged many smaller informal operators, who have often helped transfer small amount of cash offshore.
WorldRemit’s Australian customers already do more than 80,000 transfers a month with top destinations including India, The Philippines, Zimbabwe, Kenya, Nigeria, Ghana, Colombia, Malaysia, South Africa, Indonesia, Thailand and the Pacific Islands.
The Australian business now makes up 20 per cent of its global transactions.
“Australia is one of the biggest markets for international remittances but most of them so far have been offline,” Liu says, adding that sending small payments to people overseas using traditional banks can be slow and very expensive, with many recipients offshore not even having bank accounts.
“The big banks are exiting from the business,” Liu says. “They don’t want to get involved with collecting a lot of small transactions.
“(The typical remittance process in Australia) involves someone taking cash from an ATM and going to a high street shop and sending money through a company like Western Union.
“But that is changing. Around the world there is a significant shift from cash to digital.”
WorldRemit is taking advantage of the big growth in mobile money — or mobile phone “wallets” — in emerging companies such as Kenya’s successful Mpesa.
While many poor people in the developing world don’t have bank accounts, many have mobile phones.
Liu says a quarter of all recipients of money sent via WorldRemit from Australia receive their funds through mobile money applications.
“Our service allows people to send money to the phones of unbanked friends and family in developing countries,” he says.
The remittance market in Australia is also used by international students and foreigners on temporary work visas such as the 457 visas.
“We are seeing a lot of growth in the market,” he adds.
Liu says the frequency of remittance transfers from Australia has also been increasing as migrants want to send more money more often to relatives overseas, who they are in contact with through the internet and mobile phones.
“Historically migrants used to send one transaction a month or every couple of months but now they want to send money more often,” he said.
Ismail Ahmed first saw the power of remittances when many of his fellow countrymen, who went to the Gulf states to work in the oil industry, used complex informal channels to get money to their families back home.
One method involved middlemen who would take cash from the Somali workers in the Gulf to buy constructions materials. These would be taken back to Africa and sold, with the cash going to the workers’ families.
Ahmed got a scholarship to study in London (from where he also sent money to his family back home) and then worked for the World Bank, studying the global remittance process.
Source: The Australian