Saudi Arabia & United Arab Emirates are among the top ten migrant hosting countries of the world with total no. of migrants in both countries around 18.3 million. The migrants in Saudi, UAE & other Gulf countries are from diversified backgrounds; ranging from highly educated engineers and consultants to low-paid laborers.
Life is not easy for these away-from-home low-paid workers in Gulf. They face different kinds of issues on daily basis yet they keep on going because some of them are sole breadwinners not only for their own families but their parents and siblings as well. One of the biggest issues they face atleast once every month is transferring money back home.
Having lived almost all my life in Saudi, I have seen them suffering at the end of every month standing in long queues, filling all those forms required, spending money on cabs to visit a money transfer center and what not. Yes, we have seen those TV ads making money transfers look like a very smooth, simple and easy process but the truth is that its painful and broken in the whole region and on top of all of this, its expensive as well.
NOW Money is a Dubai-based startup trying to change all of that. Co-founded by two bankers-turned-entrepreneurs, Katharine Budd and Ian Dillion, NOW Money partners with employers of people who are on a low-income to provide these workers with smartphone-based accounts in which they can have their salaries paid and then use the mobile applications of NOW Money either to use the available finances within UAE to buy mobile recharge cards, pay utility bills, or to transfer the money to their home countries for a small transaction fee. No long queues, no forms, no visits to a money transfer center. Everything at fingertips of these workers. According to some estimates by NOW Money, an average user saves about $1,800 in five years using their remittance services.
The company also provides all these workers with an ATM Card that they can use to withdraw cash from any ATM in the country with one free transaction from their banking partner (Noor Bank) and the following transactions or transactions from any other bank with a small transaction fee.
They have integrated different third-party providers within their ecosystem to make everything extremely secure and simple. One of these integrations is bio-metric authentication by AimBrain which allows users of the NOW Money mobile applications to login using facial recognition and to ensure security, the users are asked to blink their eye to complete the login process.
Working directly with the employers give them ability to sign up thousands of accounts in one go opposed to banks who normally acquire users one by one. The company delivers an on boarding process to all the users for compliance and risk information, and to train them on for using the applications.
According to a World Bank report, UAE is among the top ten remittance-sending countries in the world with $19 billion of remittances sent in 2016. Saudi Arabia comes second on the list with annual remittances amounting to $36.9 billion in 2016 and that’s why its nothing but natural for NOW Money to expand into Saudi.
Speaking to MENAbytes about expansion plans, Bryony Travers, Head of Marketing & Communications for NOW Money said:
“GCC expansion excites us – there is so much opportunity across the region, especially KSA and Bahrain, which we are looking at as a GCC hub. NOW Money may differ a little for each market depending on requirement and appetite, and we are already establishing partnerships in these markets. We also plan to diversify to meet the expanding requirements of our users, to include lending and other services.”
“NOW Money is currently incorporating an entity in Bahrain, with the support of the Bahrain Economic Development Board (‘EDB’) and the Bahrain Development Bank (‘BDB’). The exceptional support we have received from the EDB and BDB have been instrumental in NOW Money’s decision to come to Bahrain, in conjunction with the open business environment and access to Saudi. NOW Money is in the process of establishing other key partnerships in Bahrain and Saudi and plans to launch in these jurisdictions by at least Q1 2018” Travers added.
Having started last year, the startup has successfully raised seed investment of $500,000 and is expected to close another round of investment by Q3 this year. They’ve also won different startup competitions and awards; last one being Get in the Ring’s Abu Dhabi edition.
When asked about their biggest achievement so far, Ian Dillion, the co-founder said:
“We’re really proud to have won four awards so far, WSTEM, IBM SmartCamp, Chivas TheVenture and Get in the Ring Abu Dhabi. These awards are testament to the hard work of the whole team and it’s great to be recognised as a social start-up, bringing awareness of the current state of financial exclusion in the GCC, which we’re trying to eradicate.”
As the State of Fintech in MENA report highlights, the fintechs in region face a lot of challenges as well. Speaking about the biggest challenge they’ve faced so far, Katharine Budd, the co-founder told us:
“Each country in the GCC has its own central bank and set of regulation and data laws, meaning a fintech will likely have to re-license and find new partnerships to expand, as well as tailor their product suite. In the UAE, freezone based businesses are prohibited from taking AED deposits. Fintechs must therefore be licensed as an LLC if they wish to handle AED, requiring local sponsorship and a slightly complex (and expensive) license structure to protect itself. It must also comply with any existing central bank regulation, which, globally, remains a hurdle. To future-proof themselves, fintechs must aim to execute anything “new” safely so their trailblazing lays the path for future recommendations on regulation to be put in place, which will happen eventually. Discovering and working our way through this has been challenging for us.”
Even with all these challenges, the future for a company that’s trying to solve one of the biggest problems for millions of people definitely looks bright.