Emerging Trends and Challenges

Global Money Transfer
CEO Interview: Matt Oppenheimer, Remitly (cont.)
“People have
talked a long time
about the
digitization of
remittances but
the is now.”
Where are you finding new customers? What marketing channels are proving most effective?
We have a range of marketing channels, including both offline (TV, etc.) and online (paid search, etc.). We also have a great referral
program that customers actively use because they love our product and want to share it with their friends. All of our marketing is very
data driven, which is important to scale and grow over time.
How quickly do you expect consumer remittances to move to digital channels?
People have talked a long time about the digitization of remittances but the time to capitalize on this opportunity is now. If you look back
only 5 years, a Mexican American wasn’t ready to use a digital channel to send money. Most didn’t have a smartphone yet and most
customers didn’t yet trust digital channels for financial services. Now, nearly all of our customers have smartphones and this shift is
happening rapidly. It’s a really exciting time for the industry and for our customers.
Will the movement to digital lower the barriers to entry into the industry or should we see the industry consolidate as digital
gains greater and greater share?
While the barriers to start your average tech company have come down, the barriers to start a remittance company have never been
higher. In order to start a remittance business, a company needs to meet high net worth requirements, acquire a money transmission
license in each individual state, have a proven AML policy, secure commercial agreements and integrations with multiple international
banks, build a trusted relationship with a USA bank, and establish world-class risk systems. It’s only AFTER you get through all of these
barriers that you start to work on building the best product and marketing it effectively.
Right now the industry is fragmented with Western Union growing slowly and worth nearly $10 billion, but only having 17% global market
share. In 10 years, I think you’ll see more consolidation around digital players, with the largest ones being the ones that focus on the
customer and get the product right.
Do you expect all of the traditional, mostly cash-based incumbents to focus heavily on digital or does this create too many
channel conflicts for them?
I think the cash-based incumbents ignored digital for several years, but now they see it’s the future and are investing in it. It’s tough for
them to execute on this strategy though. Working for Barclays, I saw firsthand that new companies building disruptive technologies have
an inherent advantage against incumbents because startup businesses are smaller, nimble, customer focused, and can rethink the way
things are done. That’s why disruption occurs.
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