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Money transfer company Wise is poised to re-enter India’s $32 billion remittance market after halting new customer sign-ups to upgrade its infrastructure, following its acquisition of an RBI licence.
Key Points
- Wise paused onboarding new customers in India to enhance its infrastructure after securing an RBI licence.
- The licence enables Wise’s customers to send larger sums of money abroad.
- India’s remittance market is estimated at $32 billion, driven by travel, education, and family-related expenses.
- Wise plans to resume new customer sign-ups in India within the next few months.
- The company’s investment in payment infrastructure aims to reduce transaction fees and enhance processing efficiency.
Wise, the London-based money transfer company, is set to make a strong comeback in India’s remittance market, which is currently valued at $32 billion. After temporarily halting new customer sign-ups to focus on enhancing its infrastructure, Wise has now secured a licence from the Reserve Bank of India (RBI). This move marks a significant milestone for the company, enabling its customers to send larger sums of money abroad.
The decision to pause onboarding was a strategic one, prompted by the acquisition of the RBI licence. The company aimed to ensure its infrastructure could handle the anticipated increase in transaction volume and meet the growing demands of cross-border payments from India. With the upgrades now complete, Wise is preparing to resume customer sign-ups in India over the next few months.
India’s remittance market is a lucrative one, with the RBI reporting that Indians sent $32 billion overseas in the year leading up to March 2024, a notable increase from $27 billion the previous year. These transfers are largely driven by expenses related to travel, education, and family support.
Earlier this year, Wise announced an increased investment in its payment infrastructure, with the goal of reducing transaction fees by improving processing efficiency. This investment is part of the company’s broader strategy to solidify its position as a global leader in the cross-border payments industry.
However, the cross-border payments sector is not without its challenges. High transaction fees, fluctuating exchange rates, and security concerns are common issues that can deter customers and impact revenue. According to recent data, American merchants alone lost at least $3.8 billion in revenue due to failed cross-border payments in the year prior to the report.
To address these challenges, Wise, along with other businesses expanding internationally, is advised to strengthen partnerships with payment service providers (PSPs). These partnerships allow access to advanced tools and expertise that facilitate more efficient and reliable cross-border transactions, ultimately benefiting both the company and its customers.
As Wise re-enters the Indian market, it aims to leverage its upgraded infrastructure and RBI licence to capture a larger share of the country’s growing remittance market. With plans to resume new customer sign-ups soon, Wise is well-positioned to meet India’s significant cross-border payment needs, which have traditionally been dominated by banks.
Conclusion
Wise’s re-entry into India’s remittance market represents a key step in its global expansion strategy. With a focus on reducing transaction fees and improving payment processing efficiency, the company is poised to offer a compelling alternative to traditional banking channels for cross-border payments. As the remittance market continues to grow, Wise’s enhanced infrastructure and regulatory approval are expected to play a crucial role in its success in India and beyond.
