In summary, at macro level, the principles are as follows: Principle I : The market for remittances should be transparent and have adequate consumer production This requires transparency by individual remitting countries about their services as far as possible. The global price including fees at both ends, the exchange rate and other transfer fees should be made known to the remitter. Equally, the time it takes for transfers and accessing locations should be reduced. The receiver should be encouraged to provide bank account details to the formal channels to avoid delays. Principle II: Improvements to payment system infrastructure that has the potential to increase the efficiency of remittance services should be encouraged. This principle involves both domestic payment infrastructure in the remittance receiving countries, cross-border payment infrastructure in both home and host countries, including the infrastructure of corresponding banks. There is a role to be played by the central banks of both remitter as well as receiver's country in improving the cross-border payment infrastructure. Many central banks have taken the lead in facilitating the payment infrastructure, but there still seems to be gaps in the use of electronic networks in semi-urban and rural areas. The central banks and other relevant agencies should encourage the operators to increase interoperability of electronic networks. Similarly, the postal service should be encouraged to play a bigger role in transmitting remittances on a cross-border basis. The postal network is well known in semi-urban and rural areas and they are in a position to provide remittance services at competitive prices.

Given the heightened importance of remittances in national economies and the promotion of smooth remittance flows between countries by the international organizations, the formal financial sector has now begun to pay greater attention to the initial point of remittance collection (capturing). This means that the institutional mechanisms are focusing on both capturing as well as disbursing of remittances. The international cooperation and coordination is very important at the point of capturing because the banks and formal financial institutions in the country of origin should facilitate cross-border transfers of remittances without placing prohibitive rules and regulations and pricing on the remitter. Payment system and technological advances As you are aware, technological advances, partnerships and improvements in the payments infrastructure have significantly contributed to enhance remittances on a worldwide basis. In that sense, the payment system improvement is a key to the enhancement of remittance transfers. The  BIS Review 3/2007  1  technology advances are intended to facilitate automation, reduce costs, provide additional delivery channels and mitigate risks involved in cross border transfers. However, the reduction of costs and the introduction of additional delivery channels are yet to be developed to a satisfactory level by the formal institutional network, not only by introducing enhancements to the payment infrastructure, but also by making a concerted effort to reduce cost on remittance transfers. Several international banks and money transfer systems such as Eurogiro, Western Union have taken the initiative to target both blue and white collar workers at reduced transfer prices.