Globalization is in full swing these days, despite nationalist rumblings. And when goods and people are crossing borders, so too must money. At PayPal, for example, cross-border trade volume grew 41% last year, to over $18 billion.
Payments startups are now making a run at that opportunity, with two of the most prominent announcing large venture capital rounds this week. Remitly, a digital remittance company, said on Monday that it has raised $115 million in Series D funding. TransferWise, a cross-border money transfer company that serves both businesses and individuals, said today that it has raised $280 million in Series E funding.
“This cash will give us the confidence to fund growth,” TransferWise CFO Matt Briers tells Fast Company. He adds that the company is currently generating a small profit and on track to post revenues of around $130 million this year.
Where Remitly and WorldRemit, another startup, are taking aim at Western Union and the $444 billion remittance market, TransferWise is focused on undercutting the big banks. Banks currently charge hefty fees for cross-border transfers, creating a major pain point for small businesses, expatriates, and foreign students.
“We’re very much agnostic as to the consumer—we want to help whomever,” Briers says. “We’re building infrastructure that could help remittance activity, but [also] helping businesses or consumers working through their own bank.”
In the year ahead, TransferWise plans to further invest in its infrastructure by building out an API that financial institutions would be able to access, for a fee. The company also plans to add new geographies, such as India.
Silicon Valley venture firm IVP and asset manager Old Mutual Global Investors co-led the TransferWise round, with existing investors including Richard Branson and Andreessen Horowitz also participating.