US-BASED mobile payments firm Remitly has set up shop in Canada, giving overseas Filipinos working in this market a mobile option to remit money to households in the Philippines at a lower cost.
Remitly, an independent digital money transmitter which focuses the remittance of funds from North America to top three emerging market destinations – the Philippines, Mexico and India – announced its expansion in Canada alongside the closing of a $38.5 million fresh round of funding.
This expansion in Canada is seen as an important step in expanding Remitly’s global footprint. Canada is home to more than 7.4 million immigrants, many of whom still have family overseas. Canadian residents transfer more than $23 billion annually, with $2.9 billion going to India and $2.1 billion to the Philippines, the company estimated.
“Since day one our strategy has been to bring our service to the largest addressable remittance markets in the world,” Remitly chief executive officer Matt Oppenheimer said. “With this new financing, we are able to continue executing against that strategy by building a global footprint in the largest remittance corridors.”
Remitly is a mobile payments service that enables consumers to make person-to-person international money transfers from North America. Its online service uses the latest technology and mobile devices to eliminate the forms, codes, agents, extra time, and fees tied to the traditional money transfer process. It is a licensed money transmitter currently operating in 49 states and Washington, D.C., and sending millions of dollars to thousands of customers each month.
Instead of relying on third-party aggregators, Remitly has built a proprietary network of banks and cash pickup locations to deliver funds quickly and securely overseas. It also has created a core remittance platform that can be scaled up to serve customers residing in the largest remittance markets.
The Philippines was the first market that Remitly focused on, opening its local office in May 2011.
By serving Filipinos in the US, Oppenheimer said in an earlier interview that Remitly had gotten to know Filipino culture.
Remitly charges a flat fee of $3.99 when a customer pays using a debit card – seen lower than the rates charged by traditional couriers. This service is free for bank-to-bank account if the customer is willing to wait for money transfer in three days.
Citing data from the World Bank, Remitly said remittance companies charge an average of nearly 8 percent in fees. The use of digital technology, on the other hand, enables Remitly to charge at a small fraction of what is usually charged by traditional operators.
Remitly has over 10,000 locations for cash pick-up in the Philippines via partnerships with Banco de Oro Unibank, BPI, PNB, Cebuana Lhuillier, M Lhuillier, SM Mall and any Globe outlet.
For Remitly’s fund-raising, New York-based Stripes Group led this new round of financing while Vulcan Capital likewise participated as a new investor in this company. Existing Remitly investors also contributed to the round including DFJ, DN Capital, Bezos Expeditions and Trilogy Equity Partners, among others.
The new capital will be used to grow Remitly’s team and continue the company’s global expansion.
“Remitly’s rapid growth in a large and well-defined hundred-year-old market is a great example of how a new generation of companies is using technology and leveraging mobile adoption to deliver better, faster, and more secure solutions to increasingly discerning consumers – all at lower costs,” said Stripes Group partner Ron Shah. “By doing this, Remitly is impacting people’s lives in a significant way and we’re excited to join the team as they continue to expand their global footprint.”