Though we've recently seen less venture capital streaming into the International Payments space, plenty of companies are still successfully fundraising. We’ve zoomed in on the last six months to examine where the venture capitalists see the industry going. A few themes emerge…
First, venture money has continued to focus on the remittances end of the market. This segment is viewed both easy to size and understand and most importantly easy to disrupt. The sector is still heavily dependent on cash-based agents and serving the unbanked but as smart phone usage exponentially grows at the recipient end mobile is the obvious solution.
Second, blockchain has clearly emerged as the next back-end/infrastructure bet with Ripple, Veem and Abra all receiving 8 figure recent funding rounds serving customers across a variety of sectors.
Finally, mention must be made of Payoneer. It received $180 million in funding in October of last year and is dominating the Ecommerce & marketplace space. It has negotiated tie-ups with companies such as Amazon and with its cash pile, makes it a formidable competitor.
New Payments Hub - Vietnam
Vietnam has been popping up on our radar for the last year, but a recent initiative to support Vietnam's fintech industry by the Vietnamese government suggests we should be taking a closer look at what's going on in Vietnam.
At the end of March 2017, Vietnam's central bank established a steering committee for Vietnam's blossoming fintech scene. The initiative will appoint officials from Vietnam's Central Bank to help steer the growth of the Fintech industry in Vietnam.
According to research performed by the World Bank, remittances to Vietnam have increased nearly 10% since 2015, and are projected to continue to do so. With a population of over 90 million people, over 50% of whom are under 30, Vietnam is ripe for the fintech scene. Internet access has grown to around 40 million and smart phone ownership is growing, making access to new customers and users more possible than ever. Because a large portion of the population in Vietnam is unbanked, there is ample opportunity for fintech companies looking to tackle the remittance space with mobile applications and easier transfers.
The above chart features five buzzed about payments companies coming out of Vietnam. VinaPay is an electronic payments company based out of Hanoi. It's services are offered in the United States, South Africa, Columbia, Philippines, China, and, of course, Vietnam. Cash2VN is a traditional remittance company that is powered through blockchain. Moca, Vimo and Momo are mobile payment solutions that focus on both peer to peer payments and merchant payments.
Even Goldman Sachs sees opportunity in the industry, investing in payments company MoMo in March of 2016.