For decades, centuries even, it’s been common for people to immigrate to the United States in search of opportunities that their home country didn’t offer and, when they became successful, these immigrants would send some of the money they made to the family members that they left behind. The problem is that, nowadays, that can be rather difficult to do and often requires you to pay a significant chunk of the money you’re sending in fees and taxes. That’s why Remitly wants to simplify things, for Asian immigrants at least, and has raised $12.5 million to help do so.
Remitly, a US-based startup helping Asian immigrants to wire money home, has raised US$12.5 million in a series B round, taking its total funding to US$23 million. The round was led by venture capital firm DFJ, which has Baidu, Twitter, and Tesla in its investment portfolio. Existing investors, including Bezos Expeditions, the investment firm of Amazon founder Jeff Bezos, also participated. For Asians in the US, sending money home can be a real problem. The usual channels like banks and Western Union take hefty cuts in money transfer across borders. A World Bank report (PDF link) says the global average cost of transferring money is over 8 percent of the remittance amount. Asians are the worst affected by this, as the largest share of the world’s remittances comes to India (US$71 billion), followed by China (US$64 billion), and the Philippines (US$28 billion). A Remitly spokesperson tells Tech in Asia that “it averages a 2 percent fee, while the rest of the industry averages a 7.9 percent fee.” It also tries to make money transfer more convenient with a mobile-first approach, offering apps for both iOS and Android.