Westpac launches new remittance product

Westpac has made a strategic push back into remittances with the launch of a new product, LitePay International, which will allow its customers to send payments of under AUD 3,000 to various overseas countries. This small fee is aggressively priced, thereby allowing the bank to compete with the fees offered by remittance firms.

After stopping services to the remittance sector last year due to concerns about money laundering, Westpac Banking Corp has launched a new remittance product which has been priced aggressively to compete against the very firms it has refused to bank.

LitePay International will allow Westpac customers to send payments of under $3000 to various overseas countries. "This service will initially be available to the Philippines with a $5 payment fee and additional countries and regions will be available in due course," Westpac said in a section of its website informing customers of changes to online banking terms and conditions.

Westpac will help Filipinos sending money home with a new, low-cost remittance product. Credit: Bullit Marquez

The $5 fee is aggressively priced and will allow the bank to compete with the fees offered by remittance companies who aggregate large numbers of small transfers in order to gain lower fees than those traditionally offered by big banks for processing international payments. Bank fees have typically been around $30 per transaction, while banks also earn a margin on the exchange rate.

A recent report by Austrac said around $35 billion leaves Australia each year in remittance payments, often to families in developing countries. The Philippines is one of the largest recipient markets.