Advances in fintech have changed the lives of people worldwide. In many ways fintech has simplified the way we handle money by allowing us to do things like transfer money between accounts, more easily pay a friend who picked up the check at dinner or pay bills from anywhere, at any time. But most importantly, fintech has transformed cross-border payments.
In the past decade, we’ve seen a tremendous rate of innovation in cross-border payments. It’s hard to imagine that only ten years ago the options for sending money internationally were limited to a handful of traditional remittance players, banks and the post office. If you wanted to get money to individuals who needed it, your choices were expensive, slow and/or cumbersome.
The concept of fast, simple, low-cost cross-border payments were just starting to be conceptualized at the time. Online remittance services were not available for most individuals and mobile remittance options didn’t even exist. To the migrant worker, many of whom leave home in search of income, this was an accepted albeit painful reality that caused an additional strain on their financial condition.
Advances in fintech and innovation in cross-border payments have had a direct impact on 164 million migrant workers worldwide. Today, an estimated 800 million people worldwide are directly supported by remittances from loved ones abroad. According to the World Bank, remittances to developing countries reached a record $529 billion in 2018. In addition to the direct economic benefit of remittances to receiving families and economies, cross-border payment innovation has helped to increase foreign trade and investment, and fuel the creation of new businesses in developing countries.
Like many countries, the Philippines has come to rely on remittances as a vital part of their economy. Due to a lack of sustained economic development, political instability, a growing population with double-digit unemployment levels and low wages, 2.3 million Filipinos work abroad. These migrant workers send $31 billion back to their country each year, an amount that accounts for approximately 10% of the Philippines’ gross domestic product.
The ability to send money home is critical, but not always easy for migrant workers. Migrant workers face numerous challenges that go beyond language barriers and acclimating to new environments. Many of these workers have limited experience using technology to manage their money. Seventy-seven percent of the Filipino population is unbanked, which makes getting money into the hands of loved ones while working away from home even more challenging. Yet, earning, managing and sending money home is extremely important.
Fintech advances have not only solved many of these challenges, they’ve created opportunities for financial inclusion and empowerment of migrant workers. However, the transition from a cash-based economy to a digital one can be overwhelming. As a result, fintech companies face the complexity of building a product that will appeal to consumers across the globe. Innovating and finding new ways to be of service to diverse, unique users can’t be approached with a one-size-fits-all mentality. From the start, fintech companies must be flexible and willing to iterate, adapt and mold offerings for a myriad of cultures, environments, and usage styles.
What’s seen as ingenious in one country might be cumbersome, irrelevant or even offensive to a consumer on the other side of the world. Creating and marketing a product for the global stage requires mindfulness and the ability to:
Make attempts to get closer to the people directly affected by a product or service. Companies should commit resources to testing, learning, iterating and having as much face-to-face contact as possible with end users. It’s also important to deploy early and often to gain feedback. A product doesn’t have to be completely fleshed out in order to get reactions through user testing. Understanding human behavior is the key to building a successful product for a global audience. Losing sight of what is meaningful to a user, will result in a loss of global product viability.
Staying on top of changing trends, cultural shifts and opportunities for growth in economies thousands of miles away isn’t easy. It’s smart to have someone on staff dedicated to reviewing global fluctuations and keeping tabs on changes that may affect the viability of the product. Purposeful staffing is key overall: it’s impossible to create a successful product for the global stage without a diverse staff. Without a staff of varied backgrounds, ethnicities, beliefs and experiences, companies miss out on the chance to explore a variety of viewpoints and leverage different life experiences – all of which make a product stronger.
From the executive level to new hires, a product won’t succeed globally without full buy-in from your entire team. We emphasize our company’s mentality of diversity, empathy and a user-first focus to keep our goals top of mind for everyone, and it fortifies us as a team. Strategically hiring individuals who are entrepreneurial-minded and looking to join a philanthropic cause that helps unbanked consumers reach a brighter financial future has pushed Brightwell’s product to excel – because our team is focused on the same end result and is seeking the same personal fulfillment from making the world a better, more accessible place.
Fintech advances to cross-border payments will continue to be important to the increasing number of individuals, families and economies worldwide who rely on remittances from migrant workers. However, meaningful innovation requires a thoughtful and consistent focus on the needs of the local community beyond today’s problems with speed, simplicity and cost. This can be accomplished by organizations who are building a future state conceived through diverse viewpoints that anticipate ways to deliver solutions for empowering financial inclusion worldwide.