Wise Payments Eyes India’s $32 Billion Remittance Market After Revamp

Wise Payments Ltd., the London-based fintech, is set to resume onboarding new customers in India, targeting a slice of the country’s booming $32 billion overseas remittances market. The company had paused accepting new clients to upgrade its infrastructure after securing a key license from the Reserve Bank of India (RBI), which now allows its users to send larger sums of money abroad.

Shrawan Saraogi, Wise’s Asia Pacific head of expansion, revealed that the company plans to restart customer sign-ups in the coming months. “India is a massive market for remittances,” Saraogi stated in an interview with Bloomberg. “Our focus will be on cross-border payments, an area largely dominated by traditional banks.”

India’s outbound remittance market, controlled by major lenders like ICICI Bank and State Bank of India, has been challenging for fintech firms due to stringent capital controls, outdated payment systems, and high taxes. However, Wise is optimistic about its chances, especially after lifting the previous $5,000 per transaction cap on outbound payments from India.

Indians remitted $32 billion in the year ending March 2024, a significant increase from the $27 billion recorded the previous year, according to RBI data. These remittances were primarily for travel, education, and family support.

To prepare for the new wave of customers, Wise is enhancing its backend processes to meet compliance standards under the Authorized Dealer 2 license, which includes adhering to India’s 20% levy on most outbound remittances.

The move comes as India’s digital payments market is projected to surge to $7 trillion by 2030, up from $300 billion in 2018, drawing the interest of global fintech giants. For Wise, the Asia-Pacific region already contributes a fifth of its global revenue, making it the company’s second-largest market after Europe, excluding the UK.

Saraogi believes that Wise’s low fees and transparent services will make it a significant player in India’s evolving remittance landscape. “We aim to launch a product that’s fast, cheap, and transparent,” he said.

Source: Live Mint