Remittance start-up Sokin says it’s the first in the world to charge one flat monthly fee for withdrawals to external bank accounts outside Europe with zero transaction fees and good foreign exchange rates.
Entering into a $680 million market, the start-up is confident its business model is “unique” in a world where remittance payments still take 2-3 days.
“I don’t believe that there has been true disruption in the market,” founder and CEO Vroon Modgill tells FinTech Futures. He believes Sokin’s £9.99 a month UK plan for limitless transactions will “turn remittances on [its] head”.
With a plan to launch in Q2 of next year across the UK, Modgill says Sokin, which means remittance in Japanese, can currently serve 150 countries in 30 currencies.
Despite the ease of transferring across Europe, the founder highlights the difficulty when sending money further afield. Currently people have to pay per transaction which often leads them to save all their transactions until the end of the month so they only get hit by one fee.
Coming from an Indian migrant family who moved to the UK, Modgill saw the struggle first hand: “I wanted to personally break down those barriers since seeing them within my own family.”
The start-up plans to help businesses as well as individuals with its digital pay-out wallet, setting up personalised payment plans which are relative to the volume of transactions businesses are doing.
The idea is that customers become members of the closed Sokin platform, allowing them to not only pass money to friends and family, but also to merchants partnered with the platform which benefit from the monthly fee structure too.
“We’re trying to bring an ease to the platform” as well as a cheaper cost, says Modgill, who notes the lack of multiple API feeds in its technology.
Sokin is currently in a seed investment round. Yet to reveal its investors, Modgill does say “a lot of banks are partnering with remittance companies, and the interest in us is not so different”. The CEO confirms the start-up has already established local banking relationships in Asia, the EU an the UK.
When asked if the start-up would work with neobanks as well as older banks, Modgill says it’s not going to box itself in to work with one particular set of institutions.
As for knowing its customers, a problem which has plagued the remittance sector for decades, Modgill says the start-up has a proprietary Know Your Customer (KYC) one-step verification process for senders and receivers which gives the Sokin team an “excellent advantage over other fintech competitors”.
“Some of these legacy companies have customers who use them for eight or ten months and still don’t know them,” says Modgill.
Because of its digital set-up and banking local partnerships, the start-up is confident it can set up shop in any location very quickly.
Excited to see the future of the remittance space, Sokin’s CEO cites the latest remittance-bank deal between Ebury and Santander – an example of other players turning the space on its head.
via FinTech Futures http://bit.ly/36MABl6