(Reuters) – UAE telecoms operator Etisalat ETEL.AD, which saw $1.8 billion moved over its network last year via money transfers, has sought regulatory approval to expand its financial services offerings in the Gulf region, home to millions of expatriates.

Mobile money services allow customers to pay bills or make remittances using SMS text messages, often at a cheaper cost than through banks or money transfer firms.

“Remittances are a huge business opportunity,” George Held, director of products and services at Etisalat, told Reuters.

“The cost base for telecoms operators is much different than for banks and exchange houses. We do not need bricks and mortar branches, so our costs are lower and we can pass on this saving and offer better exchange rates and transaction fees.”

The former monopoly was expected to focus on its home market and Saudi Arabia. Both countries have large expat populations and inbound annual remittances were worth about $36 billion combined in 2010, Held said.

About 89 percent of the UAE’s 8.3 million population are expatriates, while in Saudi Arabia just over a fifth of the 27 million population are foreigners.

Etisalat’s Egypt unit could also profit from an estimated $8 billion of inbound remittances from Egyptians working abroad. Click here to read more