TORONTO — CIBC is partnering with Chinese financial services company UnionPay International to expand its remittance business and allow its customers to transfer money to China with no upfront fees.
The bank introduced its CIBC Global Money Transfer service, which charges no upfront fees and promises competitive exchange rates, in late 2015.
Since then the service has expanded to more than 45 countries, including Pakistan, Sri Lanka, Vietnam and the U.S.
Vineet Malhotra, CIBC’s managing director and head of the alternate and retail solutions, says that since launching the no-fee service the lender’s remittance business has grown by about 800 to 900 per cent.
Malhotra says the bank decided to tackle this segment of the market as a way of building relationships with clients, particularly among the country’s growing immigrant community.
Remittances — sums of money sent by migrants to their families back home — are a massive market, with US$431.6 billion being sent to the developing world last year, according to the World Bank.
The latest statistics available from the World Bank showed that Canadians sent around US$4.2 billion to China in 2014 — about one fifth of Canada’s total remittances.
“For us it’s an important market, with the immigrant community being 20 per cent now of the Canadian population,” Malhotra said.
“If we can build the right products … and capabilities that these clients want, then we can form deeper client relationships with the immigrant community.”