Last year, millions of immigrants worldwide transferred $528 billion back to their families in other countries — but a lot of the money never made it that far.
In fact, eight percent of those funds, or more than $40 billion, went to transaction and processing fees.
Remittances, as these transfers are known, are not only ripe for disruption, but necessary to sustain global growth, according to the World Bank. And Remitly, a company that allows immigrants to transfer money using their smart phones, just announced itself as a major player to lead that change.
We are transforming the way that people send money home, bringing convenience, savings, security and new levels of customer service to an underserved community.”
The Seattle-based company announced today that it has raised $135 million in a Series E round, coupled with $85 million in syndicated debt financing. The funds push the company’s valuation to $1 billion and will allow Remitly to expand its services to more countries.
The company aims to build on its mission of helping customers around the world send money home, said Remitly CEO and co-founder Matt Oppenheimer in a statement.
“We are transforming the way that people send money home, bringing convenience, savings, security and new levels of customer service to an underserved community,” Oppenheimer said. “At the same time, our business has been close to doubling year-on-year. This fundraising round will help us deliver better financial products to even more customers around the globe.”
Founded in 2011, Remitly’s mobile app is designed to make the process of sending money across borders faster, easier and more affordable. Through the app, users can make a direct bank deposit, schedule a cash pick up or transfer money directly to a mobile account. The process skips the use of forms, codes, agents and the fees that come with the traditional method.
“Remitly’s primary focus is people who are currently sending money off-line, walking to high-street money transfer agents and handing over cash,” Oppenheimer told Built In. “The difference when they make the switch to Remitly is transformative.”
Since its launch, the company has helped process more than $6 billion in transfers to countries in Africa, Asia, Central Europe, and Central and South America.
This round allows the company to build on its momentum, as it looks to expand its services. Within the past year, Remitly has expanded its services to 16 send-enabled countries and 44 recipient countries, along with reaching annual revenue growth of 100 percent for the last three years, according to the company.
Generation Investment Management led the Series E round. The debt financing comes from Barclays Bridge Bank, Goldman Sachs and Silicon Valley Bank.