Bavaguthu Raghuram Shetty, popularly known as B.R. Shetty, is a non-resident Indian from Udupi district of Karnataka.

With a degree in clinical pharmacy, Shetty went to the UAE in 1972, and founded a healthcare facility called New Medical Centre in 1975.

Identifying the potential of money transfer and remittance in an untapped Gulf market, he established UAE Exchange in 1980 with its head office in Abu Dhabi to meet the needs of expatriate population.

UAE Exchange has presence in over 30 countries with more than 700 branches. UAE Exchange India was one of the surprise applicants for banking licence when the RBI announced the names of applicants recently.

In an interview to Business Line , B.R. Shetty, who is the Chairman of UAE Exchange India, explained the thought behind applying for a banking licence.

Excerpts :

Why did UAE Exchange India think of applying for a bank licence?

We have a strong infrastructure in place with over 328 branches across India, including small towns and rural areas, of which 147 branches are in tier 2-6 centres. This would help in enhancing customer convenience in terms of accessibility.

We are into remittance, loan against jewellery and foreign exchange for over three decades. Our close association with people across the world for transferring money to their families has earned us their trust.

After being an active player for so long in money transfer and loan against jewellery, getting into banking is a natural progression. India is one of the strong markets for us. It is the largest receiver of remittances in the world and we contribute 10 per cent of the remittance flow to India.

UAE Exchange India’s presence is limited to the South ( mainly in Kerala), metros and remittance-oriented regions in the North. Will this help in your pursuit to set up a bank?

We perfectly understand the importance of being accessible to our customers. Otherwise we wouldn’t be building the world’s largest global network among remittance brands. India is the largest receiver of remittances in the world now, of which, Kerala has a significant share. Hence, our presence might be stronger there but that doesn’t make our network weaker in other parts.

We have a significant presence with around 328 branches spread across 20 States in the country, of which, 147 branches are in tier 2-6 centres. Out of 328 branches, 229 branches are outside Kerala.

In the licence submission we have offered aggressive branch expansion across all the States to take the branch tally to 800 by the fifth year of operation. We have the ability to trigger expansion on a larger scale.

One of the important criterions for a bank licence is to open branches in un-banked areas. How will you manage that? Some of the other applicants have good presence in rural areas also.

As mentioned, we also have good presence in rural areas, and 147 branches in tier 2-6 centres is a good beginning. We have offered aggressive branch expansion in the licence submission, especially in tier 5-6 centres, to take the branch tally to 800 by the fifth year of operation. Further, our reach with customers goes beyond our current branch strength, as we have 42,000 agent locations across the country. Hence, we will be able to address the RBI guideline requirement of rural reach.

Are you hopeful of getting a bank licence, as you have to compete with many others for a few licences?

We have an edge over others in many ways, and a strong pedigree. Adding to it is the trust of the customers with whom we have been working closely for over three decades now. All these make us a strong contender for the banking licence.

How will you raise capital for the bank, if granted a licence?

The RBI guidelines stipulate minimum capital requirement of Rs 500 crore to start with. We have planned for much more that. The funds will be raised through a combination of shares to the public/institutional investors through preferential allotment and from the resident entities/relatives of the promoter group.

> vinayak.aj@thehindu.co.in

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