More evidence that the online money transfer space is heating up significantly, as startups aim to disrupt the banks and incumbents such as Western Union. Money transfer startup Azimo has closed a $10 million series A round.
The new funding, which follows a $1 million seed round late last year, is being led by Greycroft Partners, with participation from Accion’s Frontier Investments Group, eVentures (who led Azimo’s seed round), TA Ventures, RI Digital Ventures, and KRW Schindler Investments.
The UK company says it will use the funds to accelerate European expansion and target other key markets in North America and Asia. Meanwhile, Kamran Ansari from Greycroft Partners, and Monica Brand, Managing Director for Accion’s Frontier Investments Group, will join Azimo’s board.
Launched in August 2012, Azimo aims to disrupt the remittance industry by letting users transfer money internationally to friends, family or other contacts via the Web, its mobile apps or Facebook, charging between 1 percent and 2 percent of the transaction, which is significantly cheaper than the rates charged by the likes of Western Union, PayPal or, indeed, the banks. The recipient receives the money either in their bank account, at local cash collection points, or as “mobile wallet” top-up credit.
It currently supports money transfer from numerous European countries to 192 countries globally, and cites fastest recipient growth in Latin America, West Africa, and South East Asia.
As we’ve previously noted, the European online money transfer market is a hot space right now, as is fintech in general. Just today, WorldRemit received a $40 million investment from Accel Partners. Last October, Dublin-based peer-to-peer currency exchange CurrencyFair raised a further $2.5 million led by Frontline Ventures. And just a few weeks earlier, Lithuanian-based TransferGo, which also operates a P2P model to undercut the banks, announced it had raised a modest €200,000 in funding to launch in the UK. Then of course there’s London-based TransferWise, backed to the tune of $7.35 million by Peter Thiel’s Valar Ventures, SV Angel, IA Ventures, Index, Seedcamp, and TAG.
To that end, Monica Brand, Managing Director for Accion’s Frontier Investments Group, comments in a statement: “We’ve looked at the investment case for numerous remittance ventures around the world. The Azimo team’s track record in the sector, disruptive business model and their commitment to serve the two-and-a-half-billion unbanked potential remittance recipients, made us decide this was the business to back. We believe this is an exciting investment with potential for scale that can also change the world for the better.”
Change the world for the better, perhaps; money does make the world go round after all. And online money transfer startups are no exception.