(MENAFN - Khaleej Times) Leading private sector Indian lender Yes Bank has identified the Dubai International Finance Centre (DIFC) as the location for its maiden offshore branch and also a representative office in the UAE.
"The DIFC has shown keenness towards the same," Rana Kapoor, founder, managing director and CEO, Yes Bank, told Khaleej Times on Thursday. "We are awaiting an approval from the Reserve Bank of India (RBI)."
According to Kapoor, who is on a visit to the UAE, Dubai is "an important focus geography" for the bank from a global Indian banking business perspective. The bank recently launched Yes Remit, an online remittance model for NRIs in the Gulf and in the eurozone area. The facility allows NRIs to send money into an account with Yes Bank or any other bank in India. The bank offers attractive exchange rates and nil transaction charges, said Kapoor.
"The GCC region is an important geography for our NRI business and our Gulf foray will play a key role in our aspiration to become 'the Savings Bank of India,'" noted Kapoor. A significant number of its key corporate clients have strong trade and commerce linkages with the Gulf region, and the bank provides the underlying financing and trade facilities to them.
"This is well supported with investments in technology and value added products through dedicated research and specialised investment planning teams, which have been the cornerstone of our strategy and will be the key driver for growth in expanding our business in the Gulf region," added Kapoor.
The bank also sees the region as a critical area for retail banking and wealth management. "We see a significant opportunity in partnering with local UAE banks and other financial institutions in the region to participate as a facilitator for trade and remittance flows within the UAE/GCC-India corridor," said Kapoor. "We have historically partnered with leading exchange houses and banks in the Middle East for servicing remittances across their customer base for expeditious fund transfer services through our branches."
Kapoor pointed out that there has been a spike in remittances from the Gulf into India, especially given the depreciation of the Indian rupee over the past six to nine months and highly favourable interest rates in India.
Referring to the recent partnership entered by the bank with American Express, Kapoor described it as "a win-win alliance for bother partners." Yes Bank would be able to offer a complete suite of payments products to its customers who will enjoy superior benefits from American Express including the industry leading membership rewards programme, best in class service, and access to a worldwide network of millions of merchants across 200 countries."
"We propose to leverage the power of American Express card programmes and the world class 425 branches-strong Yes Bank distribution network to create a mutually beneficial programme for all stakeholders," he said.
Asked about the prospects for the Indian banking sector in 2013, Kapoor expected economic growth to pick given that the government had started pursuing reforms, which were aimed at bringing back investment-led spending.
"Given the prospects of an interest rate cut and pickup in growth, we should see growth restoring with the economic scenario turning around," he added.
As for the possibility of enhanced competition, with the possible launch of banks by leading industry groups (the Indian government has already cleared the move, though the RBI has to now clear it), Kapoor noted that there is enough depth in the Indian banking system. "We do not expect the new players to impact our growth trajectory," he said.
Yes Bank was in the third year of its 'Version 2.0 (Vision & Strategy 2010-2015),' and is firmly on track with its planned goals and objectives. "The entrance of new players should be a significant step towards promoting financial inclusion in India, which remains a highly under-penetrated market in terms of credit and basic banking facilities in tier III-VI cities," he added.