ONLINE money transfer platform, WorldRemit.com, has closed a $40 million investment from Accel Partners, a Silicon Valley investor in the likes of Facebook and Spotify, in a deal that represents one of the largest venture capital funding rounds to be completed in Europe.
WorldRemit’s online platform enables migrants and expats to send quick, convenient and low cost remittance payments to families and friends abroad.
Accel’s investment will support WorldRemit’s expansion into new geographies and the development of additional products and services.
The online platform, which enables the sending of as little as US$1 for low fees, has already proven popular with Zimbabwean expats and migrants around the world.
Currently, 33% of WorldRemit’s transactions to Zimbabwe are going to mobile accounts, EcoCash being the most popular.
Said Ismail Ahmed, Founder & CEO at World Remit: “WorldRemit offers migrant workers and expats unparalleled speed, convenience and transparency when sending money home.
“We expect the online money transfer sector to account for approximately 30% of the remittance market in the next few years and that WorldRemit will be at the forefront of this change.
“We offer the most extensive range of pay-out options unmatched by any money transfer firm, including payments to mobile wallets and international airtime top up, which enable recipients to receive their money even where there is limited or no banking infrastructure.
“This faster, more flexible model is already the first choice for tens of thousands of Zimbabwean migrants sending money home to relatives and friends.”
He added: “Accel Partners with their global network and extensive expertise in the payments industry is the perfect fit for WorldRemit. We are excited to continue our rapid growth trajectory with their support.”
Harry Nelis of Accel Partners commented: “WorldRemit is moving remittance online, disrupting a traditionally offline business and democratizing payments.
“We are excited to be partnering with a team with the deep industry expertise that has enabled them to build the robust technology and strong compliance needed for a secure, trusted and world-class remittance business.”
According to The World Bank, $519 billion of remittance payments were made in 2012 of which $2.1 billion are estimated to have been made to Zimbabwe. Most remittances were handled via traditional players such as Western Union and MoneyGram, as well as a plethora of smaller and informal operators.Advertisement
The majority of these payments are still conducted via a network of physical locations, resulting in an inefficient and expensive user experience. These traditional operators also create compliance risks associated with acceptance of cash at corner shops that leaves no audit trail.
However, WorldRemit with its online-only, cashless business model offers a more efficient, affordable and transparent remittance alternative to traditional money transfer operators. Customers can send funds from 35 countries to families and friends in over 100 destinations.
Senders can use WorldRemit’s online platform, also accessible via mobile phones and tablets, to make payments by debit or credit card, or via bank transfer. Recipients can receive funds via bank deposit, direct transfer to mobile wallets, cash pickup or delivery, as well as airtime top-up for their mobile phones.
Founded in 2009, WorldRemit has partnered with leading international banks, mobile operator hubs and mobile money transfer networks including EcoCash and M-PESA, as well as an array of fast, low cost local money transfer networks.
The company currently enables more than 1.3 million annualised remittance transactions with the help of over 50 employees and expects to continue its rapid growth in 2014, expanding its staff to 200 employees by the end of the year.