Rewiring banking for migrant communities
Saar Yahalom, Co-Founder and CTO of Rewire, talks to Enterprise IT News about the realities of cross-border online transactions.
EITN: What is status quo in the online banking world today? For example is cross border banking possible, and what are the hurdles?
Saar: The status quo in the world of banking, and online banking specifically, is probably more dynamic than ever before. We see four main trends that lead this shifting reality: globalization, digitization, regulation, and accessibility.
While globalization and migration trends are probably the only aspects slowed down due to COVID-19, the processes of digitization and accessibility, which have been in motion for years, received a significant boost this year.
We also see substantial regulatory improvements as more developing countries encourage the usage of innovative banking tools instead of cash. This is also why these countries facilitate new and improved regulations. In countries such as India and Nigeria, for example, people now are able to issue digital IDs, which eases the process of opening a bank account. Moreover, the shift to digital allows individuals to manage their financial affairs remotely instead of having to physically go to the bank.
Still, while many new possibilities are now available due to these processes, we see major bureaucratic blocks for migrant workers who manage their finances in more than one country. Rewire tackles this challenge by enabling internationals to manage all of their cross-border financial needs in one place – from opening a payment account in their new home to paying bills in their country of origin. Thus, we are taking a major leap towards open banking and financial inclusion.
EITN: As a fintech, what does Rewire do? How does it leverage technology to enable more inclusive and accessible banking for migrant workers?
Saar: Rewire offers cross-border banking for migrants worldwide. In simple words, we recognized that migrants who manage finances in their country of origin and their new home often have to face three or four different financial institutions to fulfill their most basic banking needs.
To overcome this hurdle and allow individuals to manage all their finances in one place, Rewire creates strategic partnerships in both countries and offers accessible financial services in one platform.
A great example is SSS contributions for Filipinos. Using Rewire, Filipino expats can pay their SSS contributions through the Rewire platform. The process is easy and intuitive and prevents the hurdle of sending the money to a family member, then depending on the family member who needs to make the payment for them.
Another important point is that internationals often encounter difficulties in simply opening a bank account. Opening a bank account usually requires proof of address in addition to extremely specific documents, which more often than not, migrants simply don’t have. For example, many migrants live in shared apartments and don’t have utility bills registered to their names, meaning, they cannot prove that this is indeed their address.
To overcome this hurdle and allow individuals to manage all their finances in one place, Rewire creates strategic partnerships in both countries and offers accessible financial services in one platform.
This is where Rewire steps in and harnesses the power of innovative technology in order to create alternative verification methods that are tailored specifically for migrants, making their lives easier – at least when it comes to financial bureaucracy. We created a simple and intuitive onboarding process that accepts the documents migrants are able to provide. In other words, we tailored our KYC process for migrants.
Essentially, by making basic financial services more accessible to international workers and enabling them to have control over their finances, Rewire plays its part in promoting financial inclusion for migrants.
EITN: What are your geographical markets, and which segment/demographic do you target with your services?
Saar: We currently offer our services to migrant workers living in the UK, across the EU, and Israel, who originally come from developing countries in Asia and Africa such as India, China, Thailand, the Philippines, Nigeria, and more.
While everyone who could use Rewire services can open a Rewire account, we make sure to design our services specifically for migrant workers and offer them unique cross-border services tailored to their needs.
In the future, we aim to expand our reach across Asia and serve customers from additional Asian countries. We are currently looking into possibilities in Singapore, Hong Kong, and also, in the United Arab Emirates.
EITN: As a neobank, do usual banking regulations apply to Rewire? To be able to operate across borders, what are the licenses that you need to have?
Saar: Rewire operates under an Electronic Money Institution (EMI) license in Europe and an expanded Israeli Financial Asset Service Provider in Israel. These licenses allow us to form international partnerships and provide secure and accessible financial services for migrant workers worldwide.
In Europe specifically, the EMI license, granted by the Dutch Central Bank allows us to (I) issue electronic money, (II) provide payment services, and (III) engage in money remittance.
As Rewire was built on values of inclusivity and equal opportunities, we are currently working on enriching our cross-border platform and over the course of the next three years, we plan to feature new and accessible value-added services such as additional bill payments and insurance options, in addition to credit and loan services, investments, and savings.
EITN: Is remittance the only service that Rewire offers? What other banking functions/services does Rewire offer? Please share your business and technology roadmap for the next 3 to 5 years.
Saar: Rewire is building a neobank for migrants, empowering them to manage all their cross-border finances in one place. While remittance is definitely a service we provide, it is not the main one. Remittance is part of Rewire’s cross-border service portfolio in which we also offer bill payments and local money transfers in Europe.
Essentially, Rewire offers a bank account replacement to which customers can make salary deposits and are able to order their own debit card. As Rewire was built on values of inclusivity and equal opportunities, we are currently working on enriching our cross-border platform and over the course of the next three years, we plan to feature new and accessible value-added services such as additional bill payments and insurance options, in addition to credit and loan services, investments, and savings.