On Tuesday, digital cross-border payments company InstaReM announced that it had raised $13 million in funding in an investment round led by GSR Ventures, with participation from SBI-FMO Ventures, Vertex Ventures, Fullerton Financial Holdings (FFH), and Global Founders Capital (GFC).
According to the company, the investment will be used to build out its global infrastructure which, it claims, has grown sizeably, since the last round of funding. The company also plans to use funds to boost employee strength, especially at its Mumbai office.
InstaReM has raised two other rounds of funding in the past - an initial capital of $500,000 from Global Founders Capital, followed by $5 million in 2016 lead by Vertex Ventures, the venture capital arm of Temasek, Fullerton Financial Holding and Global Founders Capital.
According to media reports, the firm also plans to pursue a public listing in 2020.
Founded in 2014, InstarReM is Singapore-based cross-border payments company, started by Michael Bermingham and Mumbai-bred Prajit Nanu. Licensed as a Money Services Business (MSB) in Singapore, Hong Kong, Australia and Canada, InstaReM facilitates local payments across more than 50 countries, guaranteeing destination amount on the same day. Further, banks, telcos, and mobile wallets can also access InstaReM’s payment infrastructure
On the announcement, Prajit Nanu, Co-founder of InstaReM says,
This fundraising is significant on multiple counts. GSR has a strong network in China and the US, whereas SBI-FMO has a strong base in Japan and emerging markets. Jefferson Chen from GSR Ventures now joins the InstaRem board.
Further, Suramya Gupta, Fund Manager at SBI-FMO Fund, said,
"We are excited to partner with the InstaReM team to jointly build the leading regional cross-border digital payments platform. We look forward to plugging InstaReM into our global ecosystem of fintech and financial service companies.”
According to the press statement issued by the firm, InstaReM has now totally raised over $18 million in funding.
The company claims to currently hold eight percent market share for users remitting to India from Australia. In October 2015, the firm claimed to have hit a weekly remittance volume of $1 million (AUD).
By the start of 4Q17, InstaReM will be available across all markets in Europe and the US, in addition to Australia, Singapore, Hong Kong and Canada.
Remittances as an industry
According to the World Bank, India retained the top rank amongst remittances receiving nations, in spite of witnessing a significant 8.9 percent drop in remittances in 2016.
However, the cost of sending this money still remains high globally, averaging around 7.7 percent. Moreover, challenging behemoths like Western Union, which holds as high as a 15-percent market share worldwide, are upstarts like TransferWise and peerTransfer.
Headquartered in Palo Alto, California is Remitware Payments, a similar remittance startup started by Indian entrepreneurs. Just last October, the company announced raising funds of $1 million from industry heavyweights Vijay Shekhar Sharma (Founder of One97 Communications) and Kunal Shah (Founder of mobile payments company Freecharge, which was sold to Snapdeal in 2015).
Tarush is driven towards delivering unbiased and accurate reportage while engaging with as many mediums as possible to narrate a fresh perspective. Working for the past few years in the digital space with YourStory, he has covered the Indian technology ecosystem extensively, focusing on new age Fintech companies, while building strong connects within the industry.