Weekly Round-up (05 October – 11 November 2018)
Action continued in the remittance and fintech universe during the week of 5-11 October as stakeholders looked forward to the Singapore Fintech Festival. Among the key developments of the week, SWIFT denied the rumours of partnership with Ripple, Australia’s opposition leader promised a crackdown on high remittance fees in Australia, the US Federal Trade Commission ordered MoneyGram to pay US$ 125 mn in settlement of fraud allegations, MIT-backed SendFriend said it will integrate Ripple’s Xrapid for cross-border remittances, Singapore’s Wallex launched in Indonesia, Sweden’s leading bank SEB announced building Ripple-flavoured blockchain payments network and Western Union partnered with Kenya’s Safaricom to facilitate global money transfers. Workers’ remittances, meanwhile, continued to pour into the Emerging Markets on the back of sustained strength in the US dollar.
Singapore Fintech Festival Kicks off
The third edition of the three-day Singapore Fintech Festival (12-14 November) kicked off on Monday. This year’s event promises to be the biggest fintech event in the world to date with over 250 speakers, 450 exhibitors, 16 international pavilions and close to 40,000 participants. The Conference focuses on nine key themes across 70 sessions, including AI in finance; ASEAN fintech opportunities; cyber-security, techrisk and regtech; financial inclusion; future of banking; future of money; global investor summit; insurtech and market infrastructure.
SWIFT Debunks Ripple Integration Rumor
SWIFT threw cold water on a rumor about a possible integration with Ripple. A spokesperson for SWIFT told Finance Magnet, “I’m not sure where those rumours are coming from but the upcoming standards release … is entirely unrelated to RippleNet.” Ripple and Swift are direct competitors in the same market, but the difference in capital and influence in the world of finance is too asymmetric to think of the feasibility of an early partnership on an equal footing.
Australia’s Opposition Leader Promises Remittance Fee Crackdown
The cost of remittances is a major headache for expatriates in Australia. However, reports suggest that sending money overseas could be more affordable under a Bill Shorten government. Shorten said that his government would end “bamboozling pricing” by requiring all remittance providers, including the major banks, to disclose the true cost of transferring money overseas.
MoneyGram to Pay US$ 125 mn Fine in Fraud Case
The US Federal Trade Commission (FTC) said last week that MoneyGram has agreed to pay US$ 125 mn to settle allegations that the company failed to take steps to crack down on fraudulent money transfers. FTC said that MoneyGram breached a 2009 order that required the company to probe, suspend, and terminate high-fraud agents. The company said it would take steps to crack down on scammers who got victims to wire them money in schemes that often targeted the elderly and ranged from bogus cash prizes, to impersonating government officials from the IRS to posing as troubled relatives needing money.
MIT-backed SendFriend to Leverage Ripple’s Xrapid for Cross-Border Remittances
A consumer-facing international money transfer platform, SendFriend, which is backed by MIT Media Lab, Barclays, Mahindra Finance, Techstars, the MasterCard Foundation and Ripple is to integrate the latter’s XRP-powered xRapid to cut costs and boost the speed and efficiency of cross border money transfer services. With this, anyone can send money from anywhere, allowing the receiver get their funds wherever they are, without the need for banks or other big financial institutions. As a result, SendFriend has drastically reduced the fees charged by traditional money transfer institutions by 65%.
Singapore’s Wallex gets Remittance License from MAS, Launches in Indonesia
Singapore-based Wallex Technologies has launched in Indonesia, having obtained a Money Transfer License from Bank Indonesia and a Remittance License from the Monetary Authority of Singapore. Wallex Indonesia will prioritise on meeting the needs of the country’s SME customers. Citing data from Ministry of Co-operatives and SMEs, Wallex stated that these customers account for 97% of domestic employment and 56% of total business investment.
SEB to Build Ripple-Flavoured Blockchain Payments Network
Sweden’s SEB is to use Ripple’s blockchain technology to enable customers to make real-time intra-bank transfers between Stockholm and New York. The bank said that it has verified that Ripple’s technology is compatible with the bank’s infrastructure and work is now underway to build an operational system. Paula da Silva, the Head of Transaction Services at SEB, mentioned that all the customers of the bank are utilizing the technology for transfers. The intention is to use Ripple’s products and services for settlement between Sweden and the US that reduce costs and transaction times in cross-border payments.
Western Union Partners with Safaricom
Western Union and M-PESA announced a global P2P partnership last week that will make it easier for M-PESA customers to send money outside of Kenya and for this highly popular mobile payments platform to scale globally. M-Pesa customers can now leverage Western Union’s global-money movement platform to make cross-border payments in over 200 countries and territories, circumventing traditional infrastructure. The remittance service will support transactions in 130 currencies, with the daily money transfer amount capped at KES140,000.
Remittances Continue to Pour into Emerging Markets
Thanks to the sustained strength in the US dollar, remittances continued to pour into the Emerging Markets. The Bangladesh Bank data announced last week revealed that expatriate Bangladeshis sent US$ 5,108 mn remittances during the first four months of the current fiscal 2018-19, which is 12.17% higher than the same period of the preceding year. And overseas Pakistani workers remitted US$ 7,419.98 mn in the first four months (July to October) of FY19, as compared to US$ 6,444.46 mn received during the same period last year, according to the State Bank of Pakistan. During October 2018, the inflow of worker’s remittances amounted to US $2.0 bn, which is 37.7% higher than September 2018.
Also, Mexico’s central bank Banco de México reported that Mexico received US$2,709 mn in remittances in September, an increase of 8.8% compared with the same month of last year.
Weekly Round-up (29 October – 04 November 2018)
The week ended 4 November witnessed continued action in the remittances and fintech universe. Sustained strength in the US dollar continued to push migrants’ remittances into emerging markets. Among other noteworthy developments, Warren Buffet’s Berkshire Hathaway announced US$ 600 million investment in two fintech firms; Western Union announced a partnership with Amazon to white label its cross-border money transfer platform; Ripple announced plans to enter in the Middle East; TransferGo launched an equity crowdfunding campaign on leading European platform; and the digital banking startup, Monzo acquired the unicorn status with a fresh round of fundraising.
Remittances to Emerging Markets on a Rise
The dollar index, which measures the greenback against six major currencies, hit a high of 97.02 last week, its strongest since June 2017. With US dollar at its 16-month high amid growing signs of the U.S. economy outperforming its peers, there has been a spurt in the remittances to the emerging markets.
In India, the Non-resident Indian deposits jumped to US$ 5.7 bn in the first five months of this fiscal compared to US$ 0.5 bn in the same period last year. The rise is attributed to the sliding rupee, which makes deposits in the currency attractive for NRIs, and to higher oil prices, which have prompted inflows from NRIs in the Middle-east to increase.
In Bangladesh, remittance inflows in the first four months of the current fiscal year rose by 11.9% year-on-year, topping US$ 5 bn, due to the rise in value of the dollar against the Bangladeshi taka. Expatriate Bangladeshis sent home US$ 5.1 bn in July-October 2018 against US$ 4.55 bn sent during the same period of last FY 2017-18, according to Bangladesh Bank data released last week.
Remittances to Pakistan are expected to hit a record US$22 bn in FY2018-19. Analysts are predicting a double-digit growth in remittances, compared to US$ 19.62 bn received in 2017-18 to US$ 22.19 bn, if trends continue towards the end of the fiscal year. Pakistan has recorded a 13.14% increase in remittances in the 1Q 2018-19 compared to the same period last year, as per State Bank of Pakistan.
In Nepal, inflow of workers’ remittance in the first two months of the current fiscal year has increased by 33.4% to NPR 154.2 bn, as per Nepal Rastra Bank despite a fall in number of outbound Nepali workers. In terms of US dollar, workers’ remittance has increased by 22.3% in the review period compared to 5.2% in the corresponding period of the previous year, according to the Nepalese central bank.
Remittances to Mexico jumped to US$ 2.709 bn in September, accounting for an increase of 8.8% over the same month last year. The accumulated amount between January and September was US$ 24.676 bn, 10.8% more than in the same period in 2017, according to the Bank of Mexico, which added that the remittances sent by Mexicans who live abroad, have increased for 30 consecutive months.
Warren Buffett Invests US$ 600 mn in Fintech
Legendary investor-billionaire warren Buffet’s company, Berkshire Hathaway, which is known to make investments in tried-and-tested companies like Coca-Cola and American Express, as well as its purchases of established businesses, recently decided to try something new and add two fintech investments to its portfolio. The WSJ reported last week that Berkshire has invested about $600 mn in two major fintech companies, both of which are based in emerging markets. In August, Berkshire invested US$300 mn in Indian mobile-payment company Paytm, and recently, it has invested about US $300 mn in StoneCo, a Brazil-based payment processing company that recently went public.
Western Union and Amazon to Launch New Way to Pay
The Western Union Company announced last week that it is has been engaged by Amazon to launch a new payment option that allows international shoppers to pay in person, in local currency where available, for their online purchases. Amazon is focused on providing international customers with access to millions of products. Customers in select countries will be able to shop on Amazon and pay in person, in local currency, through the Western Union agent network. The new payment option seeks to address the needs of customers overseas, specifically for online shoppers who do not like paying virtually.
Ripple to Extend Coverage to the Middle East
To enhance its growth, the payments solution provider Ripple has decided to expand its coverage by taking its services to the Middle East with a new office slated to open in Dubai by the end of 2018. This was revealed by Dilip Rao, Ripple’s Global Head of Infrastructure Innovation while speaking at a conference in Dubai. Rao said that Ripple plans to fully enter the Asian market by setting up a base in Dubai. Rao confirmed that Ripple has signed up close to 200 institutions around the world with many of them from the Middle East. Rao also revealed that Ripple’s clients in the Middle East included the largest Islamic bank in Saudi Arabia known as Al-Rajhi, and Kuwait Finance House.
TransferGo Launches Crowdfunding Campaign
TransferGo announced the launch of an equity crowdfunding campaign on leading European platform, Seedrs, last week. With €10.5 mn committed from investors and over 5000 people pre-registered to invest, the UK-based firm is expecting to raise a total of €11.5 mn through the campaign to fuel further international expansion and product development. Co-founder and CEO Daumantas Dvilinskas says the crowdfunding campaign is “a way to bring customers even closer to our mission as we boost international expansion and develop new products”.
Monzo Acquires Unicorn Status with £85 mn Funding Round
Digital banking startup Monzo announced the close of a fresh fundraising round last week at £85mn, led by new US investors General Catalyst and Accel as the fintech firm prepares to expand. Monzo is the latest start-up to reach the unicorn status (a private company valued at $1 bn or more), following in the footsteps of fintech Revolut and cyber security start-up Darktrace. Monzo will raise more funds later this year in a crowdfunding round that will allow fans and customers to own a slice of the bank too.
Weekly Round-up (22 October – 28 October 2018)
Fintech universe was abuzz last week as stakeholders looked for clues from two big conferences – Money 20/20 & SIBOS 2018 – in two different parts of the world. Bloomberg reported that the sharp fall of the Indian rupee may boost inward remittances to India. Among the notable company updates, WorldRemit appointed Breon Corcoran as its new CEO, Azimo announced expansion of its European operations by opening a new office in Amsterdam, Earthport announced changes in its management, WorldFirst launched a Multi-currency business account in the US, Ripple released its Q3 report which indicated strong growth in XRP sales and EMQ teamed up with FOMO Pay to facilitate settlements from Singapore to China.
Money 20/20 in Las Vegas & SIBOS 2018 in Sydney
Fintech stakeholders across the globe attended – or followed – the Money 20/20 in Las Vegas and SIBOS 2018 in Sydney last week. Unsurprisingly, “Fintech” was the buzzword at both the events. The Swift International Banking Operations Seminar (Sibos) – held during October 22–25 in Sydney – was attended by over 7,000 bankers from across the globe. The four-day annual event mixed the big tech, traditional finance and fintech that are transforming the banking industry. Organized by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), Sibos focused on collaborative innovation among industry leaders from fintech, banking, internet and computer companies. Apart from banks, tech giants Google, IBM and Microsoft were also in attendance.
Meanwhile, the fintech boom was evident at the Money 20/20 2018 event that saw 11,500 industry professionals gathering in Las Vegas for the biggest U.S. conference. The event featured representatives of 3,500 companies, including some of the too-big-to-fail powerhouses as well as 400 startups like InstaReM, more than 450 speakers, hackathons, exhibits and much more. The future of cryptocurrencies and blockchain technology in the banking sphere remained the hot topics at the show. Although blockchain technology is still in its early stages and while rapid developments have taken place, recent studies suggest that the blockchain value-add to business will be over $3 trillion by 2030.
InstaReM showcased its innovative solutions for cross-border money transfers for individuals and institutions at the Sibos 2018 as well as Money 20/20.
Fall in Rupee to Boost Inward Remittances to India
Following the sharp fall in the Indian rupee against the US dollar, overseas Indians may boost remittances to a record high, helping bolster the nation’s efforts to support its currency. Bloomberg reported last week that India is expected to receive remittances of about US$ 76 bn in 2018, 10% more than the previous year. With an estimated 20 million Indians living overseas, the country receives billions of dollars in remittances each year. The record inward remittances should help bolster India’s efforts to cap its current-account deficit. The INR is currently trading at 73.2 to the US dollar, 2% off it’s all-time low of 74.4 touched on 10 October. The Indian currency has depreciated by 14% this year so far.
WorldRemit Appoints Breon Corcoran as New CEO
UK-based digital money transfer company, WorldRemit, appointed Breon Corcoran, the former CEO of Paddy Power Betfair, as its new chief executive last week. Corcoran is set to join the fintech as it pushes towards the unicorn status after successfully managing the merger of betting companies Betfair and Paddy Power in 2016. Ismail Ahmed, the founder and current chief executive of WorldRemit, becomes executive chairman. A former JPMorgan banker, Mr Corcoran’s role at WorldRemit will be to continue its global expansion at a time of growing competition in the international money remittance market.
Azimo Expands into Europe with New Office in Amsterdam
The UK-based Azimo announced last week that it was expanding its money transfer services further into Europe with the opening of a new office in Amsterdam. Azimo reported that the location will help it grow its share of the global cross-border payments market. The company has opened a new office in Amsterdam, as a base to help it grow its share of the global cross-border payments market. From Europe, cross-border payments market is over EUR 1 trillion. Three UK payments fintechs have chosen the Netherlands as their European base, City A.M. has learned, seeking to reinforce their offering for European customers amid regulatory uncertainty.
Hickman and Uberoi step aside from Earthport
Earthport plc, the leading payment network for cross-border payments, announced last week that Phil Hickman, Chairman, will retire from the Company with immediate effect. At the same time, Sunil Sabharwal, formerly non-executive Director, is appointed Interim Chairman. Earthport also announced former Chief Executive Officer Hank Uberoi will retire from the board as non-executive director. Uberoi resigned as boss of the firm in December 2017, ultimately being replaced by Amanda Mesler in July.
WorldFirst Launches Multi-currency Business Account in the U.S.
WorldFirst announced the launch of its multi-currency payments platform, World Account, for US-based businesses and online sellers, at Money20/20 USA event in Las Vegas last week. The World Account allows businesses to open and manage accounts in 7 different currencies (USD, GBP, EUR, CAD, JPY, AUD, and NZD) under one location, which streamlines expansion into new markets around the world and bypassing the complexities and bureaucracy traditionally associated with international business banking.
Ripple Unveils Q3 2018 XRP Markets Report
Ripple’s Q3 XRP Markets report indicated positive results for the cross-border payments project, which acts as validation of the coverage it has been receiving in the past 2 months. The report reveals a lot of interesting details about the project’s activity in the 3rd quarter. Ripple sold $163 million worth of XRP tokens, or 0.43% of the global volume, of which roughly $98 million was sold as a part of direct institutional sales by Ripple subsidiary, XRP II, LLC. Q3 also saw 3 billion XRP tokens released out of an escrow account, 2.6 billion of which was placed in a new account. The remaining 400 million will be used to support the XRP ecosystem.
EMQ, FOMO Pay to Support Remittances from Singapore to China
Financial settlement network EMQ has teamed up with QR code payment solution provider FOMO Pay to facilitate settlements from Singapore to China. Under the alliance, Chinese communities in Singapore will be able to directly send money to China in real-time. The partnership is supporting the growing demand for real-time international settlements from Singapore to China, with the ability to expand across other countries in Asia. According to an EMQ statement, the partnership will also facilitate and support the government’s 2020 Smart Nation Initiative to accelerate Singapore’s shift to a digital economy. It will also create more inclusive economy with greater access to digital financial services.
Weekly Round-up (15 October – 21 October 2018)
Two important events in the global financial services business in two different parts of the world will dominate the headlines in financial media this week. Meanwhile, the last week saw growing speculations about a possible partnership between two rival global payments platforms – SWIFT and Ripple, the entry of UK’s Moneynetint and Malaysia’s MoneyMatch on the RippleNet, Azimo’s entry into business payments space, Western Union’s partnership with Sampath Bank to provide money transfer services in Sri Lanka and an announcement by TransferWise to link up with payments infra in Singapore and HK.
Money 20/20 in Las Vegas and SIBOS 2018 in Sydney
The financial technology industry stakeholders are looking forward to two important events this week: Money 20/20 in Las Vegas and SIBOS 2018 in Sydney.
The Money20/20 event in Las Vegas (21-24 October) takes on the mission of creating a simpler, fairer, faster and more inclusive financial system for individuals, businesses, and society as a whole. Each year, we strive to improve and better serve our attendees who help make us the world’s most important payments, commerce and financial services event. Among other things, the participants of Money 2020 will discuss important topics such as Banking & Crypto, Fintech for Social Good, Payments & Platforms, Regulation & RegTech and the Fintech Revolution.
And on the other side of the world, Sibos 2018 is taking place at the International Convention Centre (ICC) Sydney during 22-25 October 2018 with more than 7,000 delegates, 200 exhibitors and hundreds of conference speakers and sessions. In this 2018 edition of SIBOS conference, the participants will be discussing an important theme – “Enabling the Digital Economy”, and a main point of conversation will be Ripple. This is important for the cryptocurrency and blockchain industries, helping to take steps towards making these markets more of a mainstream option for both banks and institutions of that nature.
InstaReM is showcasing its innovative solutions for cross-border money transfers at the Sibos 2018. Visit booth #DZ34 to find more.
Ripple-SWIFT Partnership Rumours
One rumor that has gained momentum of late is that of Ripple considering partnering with SWIFT. While this rumor is yet to be confirmed, participants expect if the rumor is true than an announcement will be made at SWIFT’s SIBOS conference in Australia later this month. Speculation intensified that a partnership is in the pipeline after Ripple announced its participation in the Sibos event underway in Sydney. These rumours gathered momentum with recent news that Santander was partnering with SWIFT for a new Global Payments Initiatives program. The fallout from this partnership could potentially be one of the biggest things to happen to Ripple, as it partners with those it is aiming to replace. Moreover, they will also have access to the 11,000 clients that SWIFT boasts of if news of the partnership is true.
Malaysia’s MoneyMatch Completes Its First Cross-border Transfer on RippleNet
In a major update, MoneyMatch, a Malaysian fintech start-up announced that it has successfully conducted its first blockchain-based cross-border transaction through the Ripple blockchain. The transaction was sent over a Ripple’s xVia, a standard API solution to power payments to and from emerging markets through Ripple’s decentralized global payment network, RippleNet. According to the Kuala Lumpur-based money transfer fintech, the transaction, which enabled a retail user to convert Malaysian ringgits (MYR) to Euros (EUR) at a ‘significantly lower cost’ compared to traditional transfer services was completed in a matter of hours. MoneyMatch is also working with multiple other RippleNet partners in other jurisdictions such as India, Thailand, USA and more.
Moneynetint Joins RippleNet
Moneynetint, a UK-based electronic e-money institution, which provides cross-border money transfers and currency exchange for corporate clients around the globe, announced last week that it has completed the integration phase with Ripple. Moneynetint has already received payment instructions from two other network partners. These partnership agreements will allow the firm to process payments in a decentralized manner. The cooperation signed with Ripple is part of MoneynetInt’s strategic move to advance into innovative areas of the payments industry.
Azimo Steps into Business Payments Space
UK-based Azimo digital money transfer service is taking on high street banks with a new service for businesses. Azimo Business, which launched last week, allows SME owners across the UK and Europe to pay for goods, salaries and investments in 189 countries and territories. With pricing that will undercut most banks by at least 75%, the service is aimed at entrepreneurs who are tired of high fees and unreliable technology from high street providers. In another statement, Azimo Chief Product Officer Dan Martins said that business payments have lagged behind consumer payments in terms of mobility.
Western Union and Sampath to Provide Money Transfer Services in Sri Lanka
Money transfer giant Western Union inked a deal with Sampath Bank, a leading bank in Sri Lanka to provide better money transfer services nationwide without recipients having to wait for days to get their funds from abroad. Western Union customers can now send money to Sri Lanka from over 200 territories and countries. Sampath currently has 229 branches in the country and its partnership with Western Union is expected to give better access and convenience to its account holders who regularly receive money from relatives who live and work overseas. The bank also has super branches that are open seven days a week.
TransferWise to Link Up with Payments Infra in SG, HK
UK-based TransferWise plans to nearly double its Asia Pacific headcount and link up with new instant payments infrastructure in both Hong Kong and Singapore. Competition in digital payments in Hong Kong, Singapore and across Asia is becoming increasingly fierce, as traditional financial institutions and new technology firms from around the world vie for dominance both within markets and in cross border payments. The company is currently applying for a stored value facility (SVF) license in Hong Kong so it can connect to Hong Kong’s Faster Payments System, which began operations in September.
Weekly Round-up (8 October – 14 October 2018)
The week ended 14 October 2018 saw continued action in fintech and remittance space as well as in individual companies. The International Monetary Fund and the World Bank jointly released a paper to guide policymakers around the world in their handling of fintech – including those involved in cross-border money transfers. While the voices continued to rise against blatant currency exchange rip-offs by Australian banks, money transfer giant Western Union launched high value account-to-account transfers from the UK; Worldpay extended its real-time payouts to over 50 countries; and surprisingly, Ripple partner Santander became one of the first banks to adopt SWIFT’s Global Payments Initiative (GPI).
IMF, World Bank unveil Fintech Agenda
In a significant industry development, international development agencies International Monetary Fund (IMF) and the World Bank launched the Bali Fintech Agenda, a set of 12 policy elements aimed at helping member countries to harness the benefits and opportunities of rapid advances in financial technology that are transforming the provision of banking services. These elements include using fintech to promote financial inclusion, allowing new technology players to have level playing fields with existing companies and having countries work together to protect the global financial system. As part of the Bali Fintech Agenda, the World Bank will work on using fintech to deepen financial markets, enhance responsible access to financial services, and improve cross-border payments and remittance transfer systems.
Will ACCC Check The Great Australian Bank Rip-off?
Voices continued to rise against blatant currency exchange rip-offs by Australian banks. According to a Mozo research, Aussies are paying some of the highest money international money transfer costs in the world, thanks to the big four banks. Mozo research shows that the big four banks are charging 4.7% more to customers, on average, on overseas money transfers than online operators like InstaReM, XE, World First etc. Capital Economics estimates that in 2016 Australians likely paid at least a $1 bn more in high fees and poor rates on their currency exchanges than they would pay in a competitive marketplace. To address the matter, the government announced last week that the Australian Competition and Consumer Commission (ACCC) will launch an investigation into foreign currency services.
Western Union Expands Digital Services in UK
The global money transfers giant Western Union Company announced its foray into the multibillion-dollar bank account-to-account money transfer sector for consumers, by launching high-value digital transfers from the United Kingdom to around the world. Consumers in the United Kingdom can now send up to £50,000 via their smartphones from wu.com or the Western Union mobile app, funded from accounts directly into bank accounts in many countries around the world. The sector has been rife with competition in recent years, with significant players coming out of the UK to disrupt the industry with fintechs like TransferWise, InstaReM etc. disrupting in international payments.
In another update from the company, Western Union announced a collaboration with Hosei University that will give students of the Japanese Language Program the ability to pay their tuition and expenses with WU GlobalPay for Students, offering a simplified payment process, with the assurance that funds will arrive on time and in full, without hidden charges.
Worldpay extends real-time payouts to over 50 countries
US-based money transfer firm Worldpay has extended FastAccess, a platform that enables real-time payouts, to more than 50 countries across North America, Europe and Asia. The solution enables seamless card-based payouts to be made within a maximum of 30 minutes. Worldpay’s dynamic payout solutions combine the enhanced Worldpay Bankout solution, which now delivers 154 direct bank disbursement destinations (up from 65), and Worldpay FastAccess – enabled by Visa Direct.
Ripple partner Santander goes live with SWIFT’s GPI
There were been reports last week that Santander is one of the first banks to adopt SWIFT’s Global Payments Initiative (GPI). According to reports, the banking giant will be using SWIFT’s GPI technology for cross-border payments and go live in four countries including, Poland, the UK, Spain and Argentina. However, this presents a conflict, as Santander was also one of the first banks to utilize Ripple’s xCurrent technology on a large scale with its OnePay FX app. This has led many to believe that Santander is beginning to move away from Ripple’s solution to what they chose it over. However, it is a confusing move, as the bank had recently announced the expansion of its Ripple (XRP)-powered OnePay FX Platform to other European countries.
Weekly Round-up (1 October – 7 October 2018)
Action continued in the remittances space last week with Ripple and TransferGo dominating headlines with major announcements at Ripple’s Swell by Ripple Conference. InstaReM received the “Network Accelerator Award” at the first-ever Blockchain Innovator Awards at the Swell Conference. Among other notable updates, Aussie competition watchdog ACCC announced inquiry into foreign currency conversion services after it received complaints against Western Union, PayPal and banks. Further, Western Union continued with its digital expansion and PayPal launched payments app for merchants in India.
The Swell by Ripple Conference
Ripple held its second annual Swell by Ripple customer conference last week. Over two days, the world’s leading experts in policy, payments and technology converged in San Francisco for 14 dynamic sessions, featuring 32 speakers, on the future of payments. The event also provided an opportunity for Ripple’s customers to meet, share and establish new corridors on RippleNet. The former US president, Bill Clinton, who was the keynote speaker at the event, said the potential of blockchain technology was very high and this was because the technology was accessible across national and international borders without excluding individuals based on their income group.
InstaReM Receives Ripple’s Network Accelerator Award
At the Swell conference, InstaReM was awarded the “Network Accelerator Award” at Ripple’s first ever Blockchain Innovator awards. The award was announced at the Swell Conference with InstaReM triumphing due to the number of currencies for which its able to provide, making it a faster, more transparent payment experience. The award recognizes InstaReM as the company that has brought the most matches onto its RippleNet. InstaReM has been able to provide transfers in a number of currencies and a faster and more transparent payment experience, which helped it clinch the prestigious award.
ACCC to Probe Currency Transfer Rates
In a notable update from down under, the Australian Competition and Consumer Commission (ACCC) launched an inquiry involving money transfer services and the expensive fees they charge to customers. The investigation is adding more pressure on Australia’s international money transfer and banking industry. The banks, traditional money transfer firms Travelex and Western Union, and more recent market entrants such as OFX and TransferWise are expected to be consulted by the ACCC inquiry. What sounded the alarm is the cost of sending funds from Australia to other nations. The World Bank has reported that Australians sent around AU$8.8 billion overseas in 2016. Yet they also found that Australia is the third most expensive G20 country for consumers and small businesses to send money from.
Western Union Gets Aggressive on Digital
The Wall Street Journal reported last week that Western Union is aggressively expanding its digital services as the money-transfer giant tries to keep pace with competitors vying for international transfers. At stake in this digital race is a growing share of an industry that each year handles more than half a trillion dollars in remittances, in which money mostly flows from migrant workers to their home countries. Western Union estimates that westernunion.com money-transfer revenue—which includes use of the mobile app— last year topped $400 million, or about 11% of its revenue.
TransferGo Launches Fee-Free Money Transfers
At the Ripple’s Swell Conference, UK-based remittance firm TransferGo announced that it has launched TransferGoFree, a fee-free international money transfer service, which means that the customers will be able to transfer money to 47 countries at no cost. TransferGo said it will charge zero fees and make the money transfer at the mid-market (inter-bank) forex rate. It is using Ripple to offer its fee-free transfers.
PayPal Launches Payments App for Indian Merchants
The global digital payments major PayPal has launched its first merchant facing app in India named PayPal for Business. The app makes available to them computed sales insights, professional invoicing capabilities and scope to accept payments in multiple currencies from across the world. The app is specifically aimed at the large number of freelance merchants as well as small merchants going online for the first time, especially through mobiles.
Weekly Round-up (24 September – 30 September 2018)
The week ended 30 September saw continued action in the remittances and fintech space with Chinese tech giants Alibaba and Tencent dominating the headlines with reports of their remittance business plans. Ripple was in the news with its Japanese JV securing a license from Japanese regulator and the launch of RippleNet-based initiative by Thailand’s Siam Commerial Bank. Among other updates, Google and Goldman Sachs announced investment in money transfer startup Veem; Western Union is exploring sale of its business-payments arm; and Stripe has become one the world’s top 10 most valuable startups.
Alibaba and Tencent Chasing Remittances
Remittance business in Asia may see a further transformation with the entry of Chinese tech giants Alibaba and Tencent. In a research, Daito Nippon Brokerage noted last week that both companies have recently launched money-transfer services that allow Hong Kong-based workers from Indonesia and the Philippines to send money home at low cost. Observers see these moves as Chinese tech giants’ first steps in the global remittance business. According to Reuters, Alibaba’s financial affiliate Ant Financial called its Hong Kong remittance initiative a starting point and significant step in accelerating its pace to promote financial inclusion globally. On the other hand, Tencent’s WeChat Pay is more cautious about plans for its Remittance service, although the company is open to “all possibilities.” Alibaba and Tencent face competition in remittances, not to mention the long list of technology and financial services companies that aim to compete more broadly in payments.
SBI-Ripple’s MoneyTap App Receives Regulatory Approval
Ripple’s partner and Japanese Fintech giant SBI Holdings revealed that its subsidiary, SBI Ripple Asia, is registered as a substitute agent for electronic payments. This move will completely clear the way for SBI Ripple Asia’s smartphone app MoneyTap. The application creates an environment that allows quick and safe money transfer between individuals. In a related update, SBI Remit, the largest remittance provider in Japan, partnered with BitPesa, a digital forex and payment platform for frontier markets based in Kenya. The collaboration aims to make the payment between Africa and Japan seamless and easy by using the blockchain platform.
Siam Commercial Bank Launches Ripple’s (XRP) Multi-hop
To reduce the hitches emanating from cross-border payments through inefficient management of global liquidity, which is prominent to the ASEAN region, Thailand’s Siam Commercial Bank is launching a new feature, “multi-hop” that makes it easy for banks to settle frictionless payments on behalf of other financial institutions on RippleNet. The innovation completely eliminates the necessity for a direct one-to-one connection between financial institutions purposely to settle payment. With the deployment of multi-hop, SCB can receive and transfer payment without a bilateral link that exist between the payment originator and beneficiary institutions.
Cross-Border Payment Startup Veem Gets Investment Boost
Veem, a blockchain-based international money transfers startup, has closed its final round of funding that helped raise more than $25 mn, led by Goldman Sachs, Google Ventures, Silicon Valley Bank and Kleiner Perkins. Veem is a new player in online payment sector and this investment will help it to grow further. The expansion would involve leveraging blockchain technology for secure, fast and affordable international money transfer. The expansion may involve finding a better network infrastructure for each fund transfer.
Western Union Is Weighing Sale of Business-Payments Unit
Western Union is weighing a sale of its business-payments arm, which could fetch at least $500 mn, according to a Bloomberg report last week. The unit provides small- and medium-sized businesses with cross-border supplier payment services, enabling those companies to pay vendors in their local currencies to mitigate against foreign exchange risk and fees. According to reports, the business payment operations have become burdensome for WU following corporate tax changes that affect the finances of US businesses in their overseas operations. WU relies significantly on foreign cash to provide its cross-border business payment services.
Stripe Jumps into World’s top 10 Most Valuable Startups
The payments company Stripe announced last week that it had raised an additional $245 mn of investment, pushing its value to $20 bn. Stripe’s valuation has more than doubled from $9.2 bn in just two years. The investment round was led by Tiger Global Management, along with DST Global and Sequoia. Stripe’s products are designed to streamline online payments and billing. The San Francisco-based company plans to use the money it raised to expand its international reach, grow its payments and treasury network, and build out enterprise features as larger companies adopt its platform.
Weekly Round-up (17 September – 23 September 2018)
Ripple dominated headlines in the fintech universe last week with a dramatic turnaround in the price of its beaten-down cryptocurrency XRP following a slew of positive news from the company. Action was conspicuous in some of the key remittance corridors of Africa with traditional and digital money transfer services providers like WorldReMit, MoneyGram and Remitly announcing new partnerships in the remittance hotspot. Let’s take a quick look at where the action was in the international remittances and fintech universe last week…
Ripple News: XRP Bounces Back
On the back of a slew of positive news, Ripple’s XRP, one of the worst-performing cryptocurrencies this year, made a strong comeback last week. XRP’s market capitalization crossed the US$ 25 bn-mark, surpassing Ethereum as the world’s second most valuable cryptocurrency. XRP has been the one of the worst-performing cryptocurrencies this year, having fallen more than 90% off its high at one point this summer. The recovery in XRP is attributed to a couple of positive news from Ripple.
Sagar Sarbhai, head of regulatory relations for Asia-Pacific and the Middle East at Ripple, told CNBC last week that the firm was making significant headway with its xRapid product, aimed at helping banks speed up transactions by using XRP. Sarbhai told CNBC that he was confident that the company will launch the product live in production in the next one month or so. The surge in XRP was also aided by the announcement from Ripple that its network (RippleNet) was now live in over 40 countries across six continents as the new payment corridors opened up in North America, Asia, Africa, Europe and South America, which will create more connection points for RippleNet members around the world.
In another development, Ripple announced adding PNC Financial Services Group, a leading bank in the US, to its network of users, enabling the PNC customers to receive real-time cross-border payments. With more than 8 million customers and retail branches in 19 states, PNC has a diverse set of customers, including consumers, small businesses and large corporates. Ripple’s technology will have an immediate impact on each of those groups, enabling PNC’s commercial clients to receive payments from overseas banks in real time.
Updates from WorldRemit
UK-based digital money transfer fintech WorldRemit announced last week that integrating with WhatsApp – one of the most popular messaging services in the world. With this, customers in over 145 countries may now receive WhatsApp notifications about their money transfers in real time. WorldRemit claims to be the first Fintech company in the UK to integrate with the WhatsApp Business solution.
There were also report that WorldRemit is looking at expanding its services to the African business community, with the launch of service in East Africa, the fastest growing region on the continent. The company announced a deal with Nigeria’s Access Bank to further expand its reach within the country. The partnership will make it easier for senders to transfer funds straight to bank accounts under Access Bank, and WorldRemit customers will be able to do this from over 50 countries via their mobile phones.
Also, there were reports that WorldRemit founder Ismail Ahmed was planning to step down as CEO and take up role of executive chairman. The shift comes as WorldRemit considers an eventual IPO that the company is planning in the next couple of years.
MoneyGram, Zeepay to Collaborate
US-based traditional money transfer giant MoneyGram announced partnering with local fintech Zeepay last week to provide remittance services to mobile money users in Ghana. Individuals in Ghana can now receive money into their mobile money wallets, irrespective of their location in Ghana and beyond. The partnership is expected to increase remittances in Ghana by $1 billion each year.
Remitly’s Makes Waves in Asia and Africa
US-based money transfer firm Remitly is eyeing a larger piece of the Philippine remittance pie, and it is seeking to corner around 40% of the market by 2022 from around 16% currently. In a media interview on the sidelines of a press briefing, Gene Nigro, Remitly’s VP for Global Business Development, said that the Philippines remittance market is growing at about 8% a year, and the online market is growing at triple digits and the company hopes to capture a substantial part of that market in the next four years.
In another update, Remitly announced entering into a global co-operation agreement with African remittance major Moneytrans to extend its modern and convenient remittance experience to Africa. Through this partnership, Remitly and Moneytrans will make available 4,000 retail payout locations in 10 countries which will help Remitly better serve the fast-growing remittance corridors in the Middle-East, North and Sub-Saharan Africa, which were collectively worth US$ 91 billion in 2017.
Weekly Round-up (10 September – 16 September 2018)
Last week saw continued action in international Remittances and Fintech universe. In a major industry update, New York’s banking regulator sued the government to void its decision to award national bank charters to fintechs. Among the updates from industry players, Japanese financial giant SBI Holdings will soon launch a payments application for iOS and Android devices powered by Ripple’s distributed ledger technology. Ripple was in the news also for Saudi Arabia’s National Commercial Bank coming on RippleNet. And yes, there were talks of Ripple’s potential partnership with Apple. Australia’s OFX launched its Global Currency Account in the UK, and Transferwise announced its numbers. Elsewhere, Western Union expanded its digital money transfer service to Mexico, Remitly announced expansion into Europe and Ria Money Transfer signed an agreement with Boost Mobile for global money transfers.
New York Sues US To Stop Fintech Bank Charters
In an industry update from the US, New York state’s banking regulator sued the federal government last week to nullify its decision to award national bank charters to fintech companies. Maria Vullo, superintendent of New York’s Department of Financial Services, called the July 31 decision by the Office of the Comptroller of the Currency to let fintech companies obtain charters “lawless, ill-conceived, and destabilizing of financial markets.” She said New York could best regulate those markets, but the OCC decision left consumers “at great risk of exploitation” by weakening oversight of predatory lending, allowing the creation of more “too-big-to-fail” institutions. It’s the second time that the Conference of State Bank Supervisors (CSBS) has filed suit against the OCC.
Japan’s SBI To Roll Out Ripple DLT-Based Payments App
Japanese financial giant SBI Holdings will soon launch a payments application for iOS and Android devices, powered by Ripple’s distributed ledger technology. Last week, SBI Ripple Asia – a JV between SBI Holdings and Ripple – announced that MoneyTap, the Ripple-powered app to facilitate low-cost money transfers, will first go live for three consortium members, before a staggered roll-out to the rest of the 60-odd consortium members, covering almost 80% of banking assets in Japan.
Saudi Arabian Banking Giant, National Commercial Bank, Joins RippleNet
In another update, Ripple announced last week that the National Commercial Bank (NCB) of Saudi Arabia – also known as Al Ahli Bank – one of the largest banks of the Islamic World – has joined the RippleNet. NCB will connect to other financial institutions around the world through RippleNet. The bank will first connect to financial institutions in North America and Asia, starting in Singapore.
Will Apple & Ripple Partner Up?
Over the past few months, Ripple has been partnering up with a number of other large financial institutions and companies. However, the one partnership that has got the whole of the Ripple community excited about is the connection with Apple. Last week, Global Coin Report pointed to the fact that back in May, Apple integrated Ripple’s Interledger Protocol as part of Apple’s cross-platform payment systems, which was quite a boon for XRP’s value. More recently, Apple reportedly added XRP to one of its stock-tracking applications.
OFX Brings FX Account Services To The UK
Another Australian foreign currency exchange company OFX has launched its Global Currency Account in the UK. Available to importers and exporters, the Global Currency Account is designed to simplify cash flow management for online merchants trading on international marketplaces. With the Global Currency Account, ecommerce merchants in the UK can now manage marketplace payments in multiple currencies (pounds, euros, US dollars, Hong Kong dollars, Australian dollars and Canadian dollars) using the feature.
TransferWise Announces FY 2018 Performance Figures
In an annual update last week, TransferWise announced that it has been profitable. For the year ended March 2018, the London-based money transfer firm reported a post-tax net profit of £6.2 mn (US$8 mn), according to CNBC. Its annual revenue nearly doubled to £117 mn during the period. The company said that $3.9 bn worth of transactions were moved around each month by its 4 million users.
Western Union Expands In Mexico With Digital Money Transfer
Last week, Western Union launched its mobile app with omni-channel choice, which will allow customers in Mexico to transfer funds digitally across more than 200 countries and territories. It enables customers in Mexico to send up to $2,999.99 at a flat fixed rate of $5. Currently, customers residing in Mexico can transfer money 24/7 with the help of the Western Union mobile app (iOS and Android) through payment options of their choice such as card in-app or cash and payment at retail.
Remitly Partners With Stripe To Expand Into Europe
US-based mobile remittance company Remitly announced launch of operations in Europe last week. Remitly has formed a partnership with payment processing platform, Stripe, to help process transactions in various European currencies. The partnership also enables Remitly quickly expand its payment mechanisms on a global basis. Remitly is now available in Austria, Belgium, Denmark, Finland, Germany, Ireland, Italy, the Netherlands, Norway, Spain, Sweden, and the UK.
Euronet, Sprint Team Up To Offer Ria Remittances At Boost Mobile Dealers
Last week, Euronet subsidiary Ria Money Transfer announced its agreement with Boost Mobile, a unit of Sprint Corporation, to enable its dealers to provide domestic as well as international money transfer services. The agreement would allow Boost customers to avail bill payment services at more than 6,000 locations globally. Meanwhile, the similar customer base of both the companies will enable Boost Mobile to drive more store traffic. It would also help Boost Mobile cater to its customers with a wide range of products and services.
Weekly Round-up (3 September – 9 September 2018)
The week ending on 9 September, 2018, saw more collaborations, expansion plans and new initiatives than the last one – While TransferGo partnered with Ripple to facilitate blockchain-enabled remittances, WorldRemit launched an inter-African money transfer service and XOOM announced a partnership with TransNetwork, among others.
Meanwhile, IBM announced introduction of a cross-border payment solution called Blockchain World Wire, which will compete with Swift and Ripple. And after decades of informal usage, the word “Fintech” entered the Lexicon, thus becoming an official word! Hurray!
“Fintech” Enters The Dictionary
In another major update of the week, after decades of usage, the word “fintech” made its way into the Merriam-Webster dictionary. Merriam-Webster defines “fintech” as “products and companies that employ newly developed digital and online technologies in the banking and financial services industries”. Another use of fintech is before another noun, which is the “fintech sector.” Merriam Webster stated: “The evolution of our technology is expressed in these terms: we are no longer naming our devices and programs, we’re talking about what we do with them, and what they do for us.”
IBM Introduces Cross-Border Payments Solution
In an update that may have a far-reaching impact on the international money transfer business, tech giant IBM announced the introduction of Blockchain World Wire, a cross-border payment solution. IBM is of the view that its Blockchain World Wire has what it takes to become the new financial rail that can simultaneously clear and settle cross-border payments in near real time. This global financial network will work on the Stellar network and will not only compete with the Swift system, but could also become a tough competitor to Ripple’s xRapid.
PayPal Crosses 250 Million Active Accounts
PayPal President & Chief Executive Dan Schulman announced last week that the number of active accounts on its platform recently surpassed the 250-million mark. In a company blog post, Schulman said this marked an important milestone for the digital payments company. To illustrate the importance of the 250-million mark, Schulman pointed out that if PayPal was a country, it would be the fifth most populated, ahead of Brazil.
TransferGo Partners With Ripple For Fund Transfers
In a key company update, UK-based digital remittance solution provider TransferGo has started processing the blockchain-enabled real-time transfers through Ripple. With this partnership, TransferGo joins the list of the few entities that facilitate instant fund transfer powered by the blockchain technology provided by Ripple Labs.
WorldRemit Launches Inter-Africa Money Transfer Services
The UK-based WorldRemit launched a new digital service within Africa, making it easier to send and receive money across the continent. According to WorldRemit, the service will make it easier to send and receive money across the continent and will also reduce the cost of sending money across borders. With the launch, the company seeks to focus on Kenya, Uganda, Rwanda and Tanzania. The service could serve frequent travellers who work in different countries as well as the owners of small businesses that purchase goods abroad.
Xoom, OXXO Pair On Money Transfers
In another company update, Xoom, PayPal’s international money transfer service, announced a partnership with TransNetwork, which allows its US customers to send money to Mexico and pick up orders at any OXXO location in the country. Xoom is the first online-only remittance player to partner with Mexico’s largest chain of convenience stores. The deal will add more than 17,000 cash pick-up locations, as well as allow recipients to choose from more than 35,000 locations in the country.
Weekly Round-up (27 August – 2 September 2018)
The week ended 2 September 2018 saw continued action in the cross-border money transfer space with some significant developments announced by the industry players as well as some major developments in the industry. While Airwallex announced moving base from Australia to Hong Kong, PayPal’s Xoom announced a partnership with Ria Money Transfer, MoneyGram with the Philippine’ Gcash and Azimo with Africa’s Interswitch. Western Union further expanded its “Digital” platform to Southeast Asia, Latin America and the Middle East and LumoXchange launched its Money Transfer Services in the Philippines. In Fintech space, Singapore’s MAS and the Dubai Financial Services Authority strengthened their existing Fintech relationship with a new agreement.
Airwallex Moves Base from Melbourne to Hong Kong
In a significant development, Tencent-backed cross-border payments service provider Airwallex shifted its headquarters from Melbourne to Hong Kong as it plans to submit a virtual banking licence application there. The company will team up with a traditional bank and other local partners as part of the application process. Airwallex co-founder and CEO Jack Zhang told SCMP that the company considered HK to be an ideal location for its headquarters as it was an international financial centre where it could serve its global clients worldwide. Another reason for the relocation to HK is the proximity to its clients including Tencent, Ctrip, JD.com and Bank of East Asia.
Paypal’s Xoom Ties Up with Ria; Expands in Ukraine
In another company update, PayPal increased its foothold in Eastern Europe and Africa, and boosted its presence in the global remittance market through a new partnership agreement. Paypal’s Xoom service has signed a deal with Euronet subsidiary Ria Money to offer Xoom customers cash pick-up services at more than 150,000 of Ria’s international network locations. The partnership will increase Xoom’s presence in Africa and Eastern Europe. In another update, Xoom announced launching money transfer services from the US to Ukraine. With this, Xoom now allows money transfers from the US to 130 countries, including Ukraine.
MoneyGram Partners with GCash in Philippines; Expands Digital Platform Further
US-based MoneyGram announced that it has tied up with GCash to launch a new money transfer service to more than 10 million GCash mobile wallets in the Philippines. With this tie-up, funds can be sent via MoneyGram online or at any one of MoneyGram’s thousands of locations in 200 countries to reach a GCash mobile wallet in minutes. The funds will then be deposited into the mobile wallet in the Philippine Peso and receivers will get an SMS notification of every incoming money transfer. MoneyGram also announced launching its online platform in Ireland, Poland, Sweden, Norway and Denmark – after expanding the platform to Australia, Austria, Belgium, the Netherlands and Portugal the previous week.
Azimo Partners with African Payments Firm
UK-based digital money transfer service Azimo announced a partnership with African payments business Interswitch. The deal will expand money transfer services from Europe, where Azimo has a presence in 23 countries, to any customer in Nigeria. The announcement coincides with Azimo’s participation in British PM Theresa May’s outreach in Africa, as part of the UK government’s efforts to build fresh trade agreements with new markets after UK’s formal withdrawal from the EU.
Western Union Accelerates Global Digital Expansion
Western Union is further expanding its international money transfer service in Southeast Asia, Latin America and the Middle East. In Asia, WU digital services will include Malaysia and Singapore after Hong Kong, where WU’s digital money transfer service is already live. In Latin America, WU’s digital service is being expanded to Mexico after Brazil, Panama and Jamaica. And in the Middle East, The UAE will join Bahrain, Kuwait, Oman and Qatar, where WU currently provides access to digital international payments. The recent expansion is part of the firm’s wider mission of bringing speed and convenience to the global payments market.
LumoXchange Launches Money Transfer Services in the Philippines
In another company news, LumoXchange, a US-based fintech payments company, announced the launch of its money transfer service to the Philippines. The company has built a platform that allows users to compare exchange rate offers from the leading banks in the Philippines and send money. LumoXchange Founder and CEO Maf Sonko said that this service can help Filipinos get P1 to P2 more for every US dollar, which can mean savings of upto 30%. The Philippine banks compete to convert inbound remittances to Filipino Pesos by offering competitive exchange rates and options to pay beneficiaries directly into their bank account or cash pick-up.
Swift’s Cross-Border Initiative Gains Fintech Support
UK-based Ebury became the first financial technology company to launch Swift’s Global Payments Innovation service, joining a network of banks in supporting GPI, which is designed to facilitate faster payments. About half of GPI payments are credited within 30 minutes and many within seconds, which should give Ebury’s customers a faster international payments experience. Ebury clients should also be able to have greater transparency into fees and payments tracking through GPI. The move has been hailed as “an important milestone” by Swift which is looking to encourage new non-bank entrants to join the traditional banks already on the service.
MAS and DFSA Bolster Fintech Ties
In a notable development in the fintech space, the Monetary Authority of Singapore and the Dubai Financial Services Authority strengthened their existing Fintech relationship with a new agreement last week. According to MAS, their most recent collaboration will see mutual referrals of promising Fintech firms between the two jurisdictions. Both authorities have agreed to work on joint projects on the application of key technologies including digital & mobile payments, blockchain & distributed ledgers, Big Data and Application Programming Interfaces (APIs). The agreement is described as a commitment by both regulatory authorities to support financial innovation and competition, thus enhancing the ability of firms to manage risk better, reduce costs and boost efficiency.
Weekly Round-up (20 August – 26 August 2018)
The week ended 26 August 2018 witnessed the remittance industry doing its bit to support the victims of the devastating floods that severely stressed the Indian state of Kerala. A number of remittance service providers including InstaReM, Western Union and others announced donations and/or waiving off transfer fees, thus contributing to the cause. Among other developments of the week, while Ripple announced three new exchange partners, the cryptocurrency fintech heaved a sigh of relief after a plaintiff voluntarily took back the class-action lawsuit filed against the company. MoneyGram expanded its digital platform to include five more countries, and Remitly announced increasing its daily transfer limits to the crucial US-to-India corridor. Among the industry updates, reports expressed concerns that the UK citizens visiting the European Union could face extra credit card charges in the event of a very likely “no-deal Brexit”.
Money transfer firms extend help to victims of Kerala floods
Remittance can be a powerful tool in helping with the floods disaster. The state of Kerala is the largest receiver of remittances among all Indian states, accounting of nearly 19% of total remittances received by India. Remittance service providers responded with generous offerings – contributing directly as well as indirectly to the cause.
InstaReM announced waiving off of transfer fees on remittances of donations to the Prime Minister’s National Relief Fund (PMNRF) to enable the influential non-resident Indian (NRI) community to contribute to the relief efforts for the people affected by the floods. Western Union announced a co-ordinated response involving the company’s employees and its agent network to provide humanitarian relief. Between August 28 and September 27, Western Union will donate US $1 for each transaction sent to a Western Union Agent location in Kerala from participating Western Union agent locations across the globe and via WU.com and WU mobile app. Transfewise is giving all customers who donate to the Kerala Chief Minister’s Distress Relief Fund through TransferWise a free transfer up to 100 GBP (or the equivalent in another currency) on their next transfer. Gulf-based UAE Exchange also waived off service fee on remittances to Kerala Chief Minister’s Distress Relief Fund.
In an interview with CNBC’s Crypto Trader show, Ripple’s head of product Asheesh Birla said their clients prefer XRP over fiat currencies for cross-border transactions. Birla said the overall costs and volatility involved in XRP are far less than the fiat currencies. Birla said that Ripple is more inclined towards providing seamless solutions for cross-border payments. He said Ripple is passionate about easing cross-border remittance. According to Ripple, smaller financial institutions and startups are more likely to see significant savings by using xRapid for cross-border transactions.
In a development that comes as a big relief for Ripple, a US District Court said that the plaintiff Ryan Coffey has voluntarily taken back the class-action lawsuit he filed against Ripple its CEO earlier this year. In another update, (there is no official communication from Ripple), there were reports that Ripple plans on merging its three main products—xVia, xCurrent and xRapid—into one convenient solution called Convergence. Ripple also announced adding three new exchange partners – Bittrex, Bitso and Coins.Ph – to xRapid to facilitate xRapid payments to move from one currency into XRP and then convert into another swiftly.
Moneygram expands Digital platforms
Traditional remittances provider MoneyGram announced the expansion of its digital platform to five new countries – Australia, Austria, Belgium, the Netherlands and Portugal. With the expansion, customers in these countries can now send money 24/7 directly to more than two billion bank accounts and mobile wallets or to any MoneyGram location in more than 200 countries and territories.
Remittance players set eye on the US-India remittance corridor
UK-based digital remittance provider Remitly announced increasing its daily transfer limits to $30,000 in the crucial US-to-India corridor in response to the growing competitive pressure in the key US-outbound corridor. Earlier, Xoom increased its daily transfer limit to $25,000 to 50 countries including India. Additional pressure comes from the other digital cross-border specialists, including InstaReM, that have made significant inroads to the US market.
Money Mover partners with AIMA
The Alternative Investment Management Association (AIMA) and international money transfers brand UK-based fintech Money Mover signed a partnership deal that will help AIMA’s 1,900 corporate members save money on overseas payments as they can now send money abroad without the burden of hefty bank fees.
No-Brexit Deal means Higher Cost-Border Payment Costs
Among other updates on cross-border money transfer industry, the odds of Britain entering a no-deal Brexit are looking increasingly likely. Implications of a no-deal Brexit for British businesses were highlighted in a technical notice published by the UK government last week. The notice stated that the cost of card payments between the UK and EU will likely increase, and these cross-border payments will no longer be covered by the surcharging ban. This will prevent businesses in UK from charging consumers who use specific payment options. Aside from this, the cost of euro transactions is likely going to increase as well. Those living in Europe or working in the EEA could also lose access to UK banking and pension services with a ‘no-deal Brexit’.
Weekly Round-up (13 August – 20 August 2018)
Action continued in the global money transfers market last week with sustained surge of the US Dollar against most other currencies. Remittances to India continued to rise as the Indian Rupee breached the psychological barrier of 70 against the US dollar. Among other developments, Ripple continued to make news in the cross-border money transfer space with the company announcing its preferred cryptocurrency exchanges and its entry into Sri Lankan market. Among company announcements in the remittances space, Wyre announced the sale of the retail cross-border service to WorldFirst and London-based WorldRemit signed a deal with Bank of Africa and Kenya’s Safaricom.
Turkish Lira Crashes as the US Dollar Continues to Strengthen
The turmoil in the global currencies market continued as the US dollar gained further strength. After showing significant weakness in 2017, the greenback has strengthened against nearly every other major currency in the world, and those of the Emerging Markets in particular. The Turkish Lira fell further as the dollar’s rise stoked fears that Turkey may find it tough to manage its large debt, which is largely denominated in the US dollar. The Turkish Lira lost nearly one-fifth against the US dollar last week. The crisis in Turkey sent ripples across the globe, and we saw a further fall in the value of European and Asian currencies. The strength of the US dollar has resulted in the Chinese Yuan coming nearly 10% off its highs of the year, the Brazilian Real losing 18% in value year to date, the Russian Ruble weakening by nearly 20% YTD and the Indian Rupee losing nearly 10% YTD.
Remittances to India Surge as INR Breaches the 70-Mark Against USD
The Indian Rupee continued to weaken against the US dollar. As the Rupee breached the psychological 70-mark for the first time against the US dollar last week, it stoked a further surge in remittances to India, especially from the Gulf and Western countries. The remittances to India have been rising in the past few months due to the volatility in the Indian currency market. Remitters to India are taking the opportunity to send their money back to India to get more value for their money.
In a new announcement, Ripple named Bittrex, Bits and Coin.Ph – in the US, Mexico and the Philippines, respectively – as its “preferred’ cryptocurrency exchanges to solidify its xRapid ecosystem wherein XRP will be used to facilitate payment flows between banks globally. Ripple announced its entry in Sri Lanka with a partnership with the island country’s Cargills Bank to facilitate cross-border payments. Cargills will integrate with the xCurrent blockchain to allow users to make safer, faster international payments. Meanwhile, in an interview with CNBC, a Ripple executive said it is looking to expand services to mainland China with its distributed ledger technology designed to speed up cross-border payments.
Wyre Sells Retail Cross-Border Payments Service to WorldFirst
Wyre, a San Francisco, US-based digital currency company helping businesses to send money to individuals and business worldwide, announced last week that it entered into a definitive account transfer agreement for the sale of the majority of its retail money transfer business to London-based WorldFirst. The transaction has already completed and the migration process has started. The transaction is part of Wyre’s larger focus for their API-first approach and WorldFirst’s global infrastructure and payment coverage made them a clear choice.
WorldRemit Signs Deals with Bank of Africa / Safaricom
Among other announcement in the cross-border money transfer space, London-based WorldRemit signed a partnership agreement with the Bank of Africa, a pan-African bank with operations in 18 African countries. The partnership will enable WorldRemit customers send remittances to any of the bank’s outlets in Uganda and across Africa. Under the new arrangement, Bank of Africa will allow customers to send money instantly to 35 new cash pickup locations in Uganda – stretching from Gulu to Entebbe and from Mbale to Mbarara.
WorldRemit also announced signing a direct partnership with Kenya’s telcom giant Safaricom last week to enable instant cross-border money transfers to 28.6 million M-PESA mobile money accounts in Kenya. The direct partnership marks the culmination of years of rapidly growing volumes of international money transfers to M-PESA accounts by WorldRemit users, and supports the company’s plan to serve 10 million customers connected to emerging markets by 2020.
MySQUAR Launches Mobile Cross-border Remittance Service
The Myanmar-focused MySQUAR has soft-launched its cross-border remittance service, the first offering on its mobile money platform. The company and its partners conducted a series of successful remittance tests earlier this summer along the Singapore-to-Myanmar corridor. The company is targeting the Singapore-Myanmar corridor first as the former has a large population of students and workers from Myanmar who frequently send money home. A full launch of the remittance service is expected by the end of September while MySQUAR is also working on additional offerings for its mobile money platform.
Weekly Round-up (7 August – 13 August 2018)
Action continued in the international money transfers and Fintech universe. Among the players in cross-border money transfers, InstaReM, Ripple and CurrencyFair making headlines. Among the key industry developments, India’s banking regulator Reserve Bank of India (RBI) unveiled its ‘Inward Remittances Survey’ and there were mixed reactions to the national fintech charter announced by the Office of the Comptroller of the Currency (OCC) in the US last week.
Singapore Provides ‘Springboard’ To Asian Markets For FinTech: Prajit Nanu
In an exclusive interview with PYMNTS, Prajit Nanu, InstaReM’s co-founder and CEO, informs what makes Singapore a “Springboard” to Asian markets for Fintech. “Singapore has a FinTech-friendly regulatory framework and has been a good springboard for us to expand into other Asian markets,” InstaReM Co-founder & CEO Prajit Nanu told PYMNTS.com. “The Monetary Authority of Singapore (MAS) provides a responsive and forward-looking regulatory approach that enables promising FinTech innovations to develop and flourish.”
InstaReM Appoints New CTO
Among other updates, the news of Nilesh Pathak’s appointment as InstaReM’s Chief Technology Officer (CTO) was covered widely in the media including Finextra, Crowdfund Insider, Baypay Forum, Inc42, The Hans India and SiliconIndia. Nilesh joins InstaReM from J P Morgan Chase & Co., where he headed the 200+ strong Regulatory Technology Group for 4 years. Pathak’s induction is aimed at strengthening InstaReM’s existing technology capabilities, while developing new ones. With more than 20 years’ of experience behind him in building high-quality software, Nilesh will be using this wealth of experience to drive the firm’s technology strategy, architecture, development as well as infrastructure & development operations.
While the price of XRP, ripple’s altcoin, briefly crashed below ¢30, the company continued to find favorable coverage in the media. In an interview with TechCircle, Ripple India’s MD Navin Gupta said Ripple’s WhatsApp-like blockchain superhighway can replace SWIFT. In another interaction with AMBCrypto, Gupta said that, Ripple has begun targeting Asian markets for the propagation of their technology. More specifically, the settlements firm is focusing on the Japanese and Indian markets.
In a recent interview, TechCrunch founder Michael Arrington said Ripple’s XRP is one of the best cryptos when it comes to moving money from one part of the world to another. In the interview with Blockinpress, Arrington explained why his crypto hedge fund Arrington XRP Capital chose to denominate in this particular crypto. Meanwhile, Cryptoglobalist noted that Ripple has been making significant progress in tapping international markets despite its native token not reflecting the fundamental value. It is optimistic about its upcoming Swell Conference where former US president, Bill Clinton, will be a keynote speaker. At the Ripple Swell Conference, InstaReM CEO Prajit Nanu will speak on talk about InstaReM’s experience making payments live between Brazil and Europe – faster and cheaper than the competition.
Currencyfair to Acquire Convoy Payments
Verdict reported last week that Irish money transfer services provider CurrencyFair has agreed to acquire Convoy Payments, the Hong Kong-based payments arm of Convoy Global Holdings. The acquisition forms part of a €20m investment strategy and marks CurrencyFair’s entry in the Asian market.
Western Union Gains Traction with Digital Remittance Market
With growing penetration of internet-enabled devices, the trend is certainly towards “digital” in the cross-border money transfer universe. FXCompared reported that Western Unuion’s consumer-to-consumer revenues at its dotcom offering, westernunion.com, surged by a spectacular 22% during the recently-ended quarter. westernunion.com’s transaction count soared by 26% compared to the same time last year. Westernunion.com accounted for 11% of the company’s consumer-to-consumer sales during the last quarter. There are still vast numbers of people relying on these services to send money home or make other forms of payment.
India – RBI’s Inward Remittance Survey
The Indian states of Kerala, Maharashtra, Karnataka and Tamil Nadu together received close to 60% of the total remittances in the country in FY 2016-17, according to The Reserve Bank of India’s ‘Inward Remittances Survey’ announced last week. According to the World Bank, India is the biggest recipient of remittances worldwide. Of the total remittances into India in 2016-17, 74.2% was routed through private sector banks, while the share of public sector banks stood at 17.3%. Foreign banks accounted for 8.5% of the total remittance. The United Arab Emirates has emerged as the top source of inward remittances. UAE’s share in total remittances was 26.9%, followed by the United States (22.9%), Saudi Arabia (11.6%), Qatar (6.5%) and Kuwait (5.5%).
Mixed Reactions to OCC’s Fintech Charter
There were mixed reactions to the national fintech charter announced by the US Office of the Comptroller of the Currency (OCC) last week. While the fintech charter has been positioned by its supporters as a means of encouraging innovation and growth, but its opponents insist that it brings new risks and market distortions to the U.S. economy. According to American Banker, the OCC’s charter creates a new class of institutions that benefits large, established fintech firms and harms the very innovation and choice that U.S. Treasury Secretary Steven Mnuchin and the Comptroller of the Currency Joseph Otting say it would provide.
Maria T. Vullo, Superintendent of the New York Department of Financial Services (NYDFS), has expressed her opposition to the US Department of Treasury’s endorsement of regulatory “sandboxes” for FinTech firms. Vullo said that the idea that innovation will flourish only by allowing companies to evade laws that protect consumers, and which also safeguard markets and mitigate risk for the financial services industry, is preposterous. Meanwhile, as per a Finextra report, the Arizona Attorney General’s Office has opened the first fintech sandbox, enabling financial services startups to bypass red tape and begin testing their products with live consumer data.
Weekly Round-up (30 July – 6 August 2018)
Coming back to this week – the week ending 5th August 2018 saw continued action in the overseas money transfer business and fintech space. While the US federal government announced its support to fintech companies, while the UK regulator getting tough with banks and money transfer firms offering misleading currency exchange rates for overseas money transfers. A few more collaborations were announced in money transfer universe while there were reports that India’s largest bank may start offering cross-border payment solutions with Ripple.
Here are the other key developments in the overseas money transfer space:
Finally, the US finally takes action on fintech regulation
In a major development in the Fintech universe, the US Treasury Department announced significant changes in the fintech regulation and extended its approval for a new fintech charter and the introduction of sandboxes and opening access to consumer data. The Treasury said that it would begin accepting applications from non-depository fintech companies interested in a national bank charter.
The news comes after years of intense debate and lawsuits from state regulators who oppose the charter. Operating under a single federal license — and dealing with a single regulator — would allow fintech companies to run more efficiently. Consumers could also end up with better products and more options when they’re looking for loans from online providers.
This could well be beginning of a new chapter in the history of fintech in the US. Innovation is a cornerstone of the U.S. economy, and creating a regulatory environment that supports responsible innovation is crucial for economic growth and success, particularly in the financial sector.
FCA Reins in Misleading Currency Exchange Rates
In another development related to the regulation, Britain’s Financial Conduct Authority (FCA) has proposed new rules to stop banks and other firms from offering misleading currency exchange rates to people sending money abroad electronically. Under the new rules, if service providers present comparisons with rival services, they must be fair and balanced and capable of being substantiated.
Bill Clinton to address the Ripple Swell Conference
Ripple announced the Swell Conference (1-2 October 2018) that boasts a star-studded lineup of speakers, which includes the former US President Bill Clinton as the keynote speaker. The conference will also include a talk with BeeTech and InstaReM, recent members of RippleNet, about their experience making payments live between Brazil and Europe – faster and cheaper than the competition.
Among other noteworthy developments, a number of collaborations were announced in the overseas money transfer space across the globe last week.
State Bank of India is considering adopting Ripple remittance solutions to reduce the time it takes for international money transfers to go through. It is believed that Ripple’s presence in India will ease the current burden of expensive and slow money transfer solutions.
The Dutch bank ING has invested €21 mn for a minority stake in cross-border B2B payments company TransferMate. As part of the deal, ING will offer TransferMate as a payment processing option for all SME and corporate clients beginning in 2019.
UNPay, the global one-stop fintech open platform provider, has signed a strategic collaboration agreement with renowned HK financial technology company, Yunfeng. Under the terms of the agreement, UNPay will provide payment solutions and remittance services for Yunfeng Financial.
Western Union, the world’s largest money transfer company, announced partnership with Albertsons to enable consumer access to international and domestic money transfer and money order services, as well as bill payment services at Albertsons’ locations.
The London-based digital money transfer firm WorldRemit announced a partnership with Fidelity Bank, one of Nigeria’s top financial services providers, for instant money transfers to four million Fidelity Bank accounts in Nigeria.