Contxto – As migrants self-isolate in whichever part of the planet they find themselves, they’re looking for new ways to wire remittances to their families back home. That’s where fintechs come in and they’ve been busy.
Chilean Global66 reports that the number of transfers it handled in April was double the amount of transactions it processed in February. Clearly Covid-19 is the culprit.
Regardless, these surges in demand didn’t deter it from launching in Mexico this month.
Making sense of fintech growth
These spikes in Global66’s services suggest that the way in which remittance platforms are perceived and operate is in for some serious adoption.
Ángel Sierra, Executive Director at the FinteChile Association is of a like mind.
“More remittance-related fintechs will emerge. And those that already exist will further develop their operations,” foretold Sierra.
Meanwhile, fintechs face a unique opportunity.
“We’re observing two things,” explained Nicolás Jaramillo, CEO at Global66. “The first is that this trend will continue as people remain reluctant to go to places with large crowds. On the other hand, we’ve also seen that users like our platform.”
Truly fintechs and other startups in education and healthcare are at a critical juncture of their growth. Never before have the circumstances been so favorable so as to attract new users.
The challenge is retaining them. Brownie points to those that offer such a great experience that their users then recommend their products to others. It’s the best (and cheapest) form of publicity.
Clarity in the Covid-19 muddle
In these times of uncertainty, remittance platforms can add a much-needed layer of transparency to international transfers.
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This is because migrants usually rely on brick-and-mortar businesses who (knowing or unknowingly) aren’t up-front about the actual amount that will reach loved ones back home. And that’s because a share of the money that’s wired is lost to predatory fees or additional processes.
Although when it comes to these types of services, one major challenge is to educate users on how it can securely manage their money. More so in instances where migrants come from low socioeconomic backgrounds.
Related articles: Tech and startups from Chile!
-ML
