UAE’s LuLu Financial expands remittance business footprint in PH
One of the largest retail conglomerates in the United Arab Emirates is expanding its presence in the local remittance and foreign exchange industry, citing the strong economic ties between Middle East and the Philippines as the deployment of overseas Filipino workers continues to rise.
At the same time, Abu Dhabi-based LuLu Financial Group believes that a significant chunk of the nearly $30 billion sent home each year by almost five million expatriate Filipinos can be channeled toward more productive sectors like helping finance the government’s infrastructure buildup program.
“The economic bond between the Philippines and the nations of the GCC are strong and getting stronger, given the large number of Filipinos working there and sending money back home,” LuLu Financial managing director and CEO Adeeb Ahamed said in an interview with the Inquirer last week.
He was referring to the Gulf Cooperation Council made up of six Persian Gulf states—Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE—which played host to an estimated 2.2 million Filipino contract workers. About one-fourth of the yearly dollar remittance tally that helps boost the Philippine economy comes from this region.
Ahamed said this huge potential encouraged LuLu Financial to open its third foreign exchange and remittance office in the Philippines to better serve Filipino clients in its home region.
LuLu Financial is a non-banking financial organization. It deals in foreign exchange, global money transfer and salary and wage administration. It has 132 branches worldwide, staffed by over 1,500 employees.
Because its parent firm is a major player in the Middle East’s retail sector, Ahamed said the group had the physical network to be able to serve GCC-based Filipinos’ remittance needs close to their workplaces. He said the remittance business in the Middle East might already be crowded, but LuLu Financial’s ties with its parent gave it the advantage of being closer to its clients.
Ahamed said it would be a good idea for the Philippines to try to harness the financial muscle of remittances from overseas Filipinos, similar to what the India had done.
He cited the case of a major international airport in India which was built with funds raised from overseas Indian workers through retail placements of equity shares.
“This was built using the public-private partnership model,” he said. “Funds were raised, airport was completed and the retail shareholders saw the value of their stocks rise sharply. This is something the Philippines can also do.”
For starters, Ahamed said it would be a good idea for the government to forge ahead with its plan to create a bank dedicated to serve the OFW community.
