By John Adams, Bank Technology News, Aug 2006
Business: Remittance, Money Transfer
Revenue: Not Available
Status: Privately Held
Recent Client Wins: MetaBank, Chequepoint, Equitable PCI Bank
THE GIANTS OF THE FUNDS TRANSFER GAME ARE Western Union and MoneyGram, and Xoom makes no qualms about that, using the term "Goliath" to describe them. But since those firms control about a quarter of the market, Xoom believes there's lots of room to make hay -- especially in the immigrant transfer business. It's making an aggressive push with a wholesale product that provides banks and small vendors the option to open up new money transfer corridors, giving immigrants a discount option to send money.
The product, Xoom WebAgent, allows banks, credit unions, retailers and money transfer operators to build or expand their money transfer businesses without the complex logistical, technological and legal hurdles that accompany the operation of remittance businesses. How? Xoom has established disbursement networks overseas, deployed vetted technology and taken steps to ensure its operations are in compliance with the varied banking and anti-money-laundering rules and regulations of different nations.
It's a bold move that's attracted the backing of Fidelity Ventures, which is arming Xoom with $15 million in financing, and the business of institutions such as Meta Bank. "It puts the capability at our customer service reps' fingertips, so they can do money transfers at the point of sale. It brings it right down to the retail level," says Mick Conlin, VP of business development and client support for Meta Payment. Conlin adds that bringing this kind of remittance function down to the user level creates the best chance of adoption, if not the only chance.