Remitly, a US-based cross-border remittance, has filed the papers for going public and also revealed its financial status along with the opportunity that it seeks to pursue in the future as it eyes the lucrative remittance market.
Its financial statements filing revealed revenue of $257 million in revenue and $32.5 million net loss in 2020 and it also revealed revenue of $202 million and a net loss of just $9.2 million in the first half of 2021 which shows its continued progress in building up its revenue and also cutting on its losses over the last couple of years. This shows that the company is in an upward trajectory and it is looking to make use of the opportunity in the remittance market which is said to be an industry of over $1 trillion globally with $40 billion being generated in fees. But this industry has not had any major disruption over the last many years and this is what Remitly is seeking to do.
The cross-border remittance industry is still being dominated by banks and other brick-and-mortar companies which means that the industry is ripe for disruption in the form of digitalization. The company’s mobile technology helps people to send and receive money across borders with its focus being on the emigrants who send a lot of funds to their near and dear ones in Mexico, India, and other parts of the developing world. The company was valued at $1.5 billion during its last funding round when it had raised $85 million.
Payments services, especially cross-border payments, are expected to do very well in the coming months as users are getting more tired of the legacy systems operated by banks and are looking for new and reliable methods of moving funds quickly. This has been made possible through the use of mobiles and digital technology and Remitly has been able to carve a space for itself in this industry. Though the company was started way back in 2011, it is only in recent years that it has been able to gain a lot of traction from the users, especially during the pandemic period as the advent of mobiles has made users prefer the ease of sending payments right from the mobile apps rather than having to visit the bank branches.
What is interesting is the fact that the majority shareholder in the company is PayU of Prosus that holds a 23.9% stake in the company and the company is slated to go public shortly.