Etisalat plans on rolling out its long-awaited mobile remittance service by the end of the year as the telecommunications operator taps into the lucrative financial services market.
Once the service is launched, Etisalat's push into the remittance business could threaten the hold of currency exchange houses on the US$25 billion (Dh91.82bn) industry.
The telecommunications giant has spent the past two years developing a programme to help its mobile subscribers to send money home to India but has been tied up by compliance and regulatory issues, said Rashed al Abbar,the director of mobile commerce services for Etisalat.
"We wanted to make sure that everything is all done before we get it out there," Mr al Abbar said.
"Everything is ready and we just launched internally ... it's been live since August.
The adoption hasn't been high but there are several people internally that are really using it a lot."
Etisalat plans on launching its remittance programme with Citibank as its first main banking partner and will later make the service available across the subcontinental area.
Mr al Abbar said the service could send money to all Indians. If the recipient does not have access to a bank account, a cheque will be delivered to the person.
"We want to cover as much as possible on the receiving side," said Mr al Abbar.
"Also, the receiver usually decides the sending method."
About $52bn in remittances were transferred to India in 2008 from expatriates working across the Gulf, according to the World Bank.
The UAE represents about 13 per cent of total remittances to India.
There are 1.75 million Indian nationals in the UAE, the largest expatriate group in the country.
Their remittances contribute significantly to the Indian economy. Pakistani expatriates represent the second-largest group, at about 1.2 million.
To send money to India, Etisalat subscribers will have to open a separate "mobile wallet" account at one of the operator's business centres that will be tied to their phone number. Money can then be added to the account through any Etisalat retail outlet or payment kiosk.
Once the account is set up, users can use short codes - *123# - to access Etisalat's mobile payment service and transfer up to Dh10,000 to India.
Mr al Abbar said the service had its advantages over its traditional brick-and-mortar counterparts since subscribers could choose to send funds and check the exchange rate all day, as opposed to during working hours.
"Convenience and cost will be really important to getting this to the market," said Mr al Abbar.
"Hopefully we will be really good compared to others.
"Our market research shows that people shop around for exchange rates and this is what we've been able to achieve with Citibank.
"Because volumes will be high, the exchange rates that we are targeting will be very good compared to other exchange houses."
Etisalat already operates a mobile service in India under the Cheers Mobile brand.
The company has about 30,000 customers across India and is in talks with several rivals including Idea Cellular and Reliance Communication for a possible merger.
The remittance service will not yet include mobile-to-mobile payments since these present compliance and regulatory issues.
That service may be launched, however, to Etisalat subscribers in India as a means to attract new customers.
"The biggest challenge is that across the subcontinent, there are no mobile transfer regulations," said Mr al Abbar.
"That's why we cannot go mobile-to-mobile yet. But if that happens, we may think of better service to our users in India."