“Crap!” Aamer quickly covers his mouth and apologizes for swearing. My New York ears were shocked. To be sure, Aamer Abedi, Chief Marketing Officer of RemitONE is a good guy. This transfers over to his passion for remittances and the people the money impacts. This, in particular, is true for the case with money transfer operators and their relationships with regulators and the banks the MTOs rely upon.
He’s helped organize the community in London at their offices, provide data to the community to further support the cause, and has developed a software geared towards regulators to earn their trust. This was 2018s RemTECH Awards Industry Choice Winner: RemitONE Compliance Manager.
They made it onto the Industry Choice ballot as a Solution For De-Risking Mention from one of our judges, and good thing because the community at the Global Forum on Remittance, Investment, and Development in Kuala Lumpur, Malaysia, decided they were the most relevant. Here is what Aamer and RemitOne have been up to since in this week’s RemTECH Chat.
Olivia Chow: You’ve been with RemitONE for nearly eleven years. How does it compare from when you first started to today?
Aamer Abedi: The industry has changed a lot. The macro and micro environmental factors have changed, forcing the industry ‘s supply chain members to adapt. The adaptation process has been slow in most cases. RemitONE has evolved its product lines and introduced innovative services along the way. We were the first non-MSB software vendor in the UK to come out with a white-label online remittance product and were the first ones to have our compliance module evaluated by regulators. We witnessed the whole bank account closures saga and fought back by working with various partners in the industry to draw upon their strengths and offer a solution to our clients. In terms of our attitude towards the industry, it has remained the same and is perhaps the one thing that has not changed. Our attitude is to remain positive and innovative at all times. We exist in the industry to solve problems for our clients using our technology and relationships.
OC: Your RemTECH Awards 2018 innovation that won the Industry Choice Award would not have made it had one of the judges decided not to give you an honorable mention. That mention got you to the finals where the attendees of the United Nations’ hosted GFRID voted for your innovation. How did that feel? Were you expecting that?
AA: It felt great. To gain that recognition at an event involving the World Bank and the United Nations was amazing. All that hard work seemed to have paid off. We were always optimistic and winning an award is always a surprise! We were humbled by the recognition. It has only made us more determined to provide more innovative solutions to help the remittance industry meet the goals set out by the World Bank and the UN.
OC: Can you tell our readers a little bit about your innovation? And how you developed the idea?
AA: We realized that the governments and central banks are still struggling to track remittance inflows and outflows. They are missing the mark in some countries by billions! We realized that we had the technology to address this issue in the industry to help bring about transparency and visibility to the central banks on all transaction volumes that fall under their ‘remit’! Hence we came up with the concept of the RemitONE Compliance Manager. This innovative product can not only help the central banks but can also facilitate money service businesses to thrive whilst ensuring fair competition in the market. Because this innovation gives end to end visibility on transaction flows, it allows banks to ‘bank’ the money service businesses too (as banks would have to come up with a very good reason to reject the money service business’ bank account application). This also encouraged the industry players to jointly push more transactions through formal channels.
The second innovation we have introduced is our MSB tailored consulting service called ‘Nucleus‘. There are several MSBs and new entrants to the money transfer industry that require MSB licensing and bank account solutions. So we saw that there was an opportunity to help MSBs get both a license and a bank account using our technology platform which has been evaluated by several regulators. The Nucleus service has taken off like a rocket and we are now helping several MSBs from across the globe. This service is the need of the hour and has been received exceptionally well by the market, despite Brexit!
Our third innovation addresses one of the most crucial issues in our industry −the ‘bank account for a cash-based business problem. We’ve embarked on a joint venture with a bank account provider and cash processor allowing our client MSBs to manage both their cash and non-cash businesses. We also provide our client MSB with the payout networks of our partner aggregators. This makes us a one-stop-shop for our clients, allowing us to deliver a complete end to end remittance solution. So if an MSB is struggling with any of these issues – licensing, bank account provisioning, cash processing, online payments, payout networks – we can help!
OC: Are there any learnings or opportunities gained from participating in RemTECH Awards?
AA: RemTECH is a great and much-needed initiative in our industry. It encourages and incentivizes the industry supply chain members to think innovatively and compete fairly . It unifies everyone’s mission, which is to allow people to send money safely at competitive rates and help people climb on to the financial ladder. There is a strong social responsibility aspect in RemTECH which makes the awards all the more prestigious.
OC: Do you have any updates on the RemitONE Compliance Manager?
AA: Our Compliance Manager is evolving constantly. We are getting ready to promote it to our target markets. There is a global demand for compliance products across several verticals, not just remittances and payments. We have a plethora of great features in our compliance module. For example:
- Different compliance rules can produce different point scores and when a predefined threshold is crossed, a compliance restriction can kick in. So multiple scores from multiple compliance rules can add up to a total score that triggers compliance flags
- Two-level administrator compliance or maker checker as it’s called in the industry
- Flexible volume and velocity checks over a time period
OC: I attended a RemitONE meet up when I was visiting London last. Because RemitOne has such a wide reach and as a result has a lot of access to market data, which you shared. What surprising or impactful trends are you seeing now? (happy to have you share the data you did then or anything new!)
AA: The money transfer industry in the UK is going to witness key shifts. Based on RemitONE’s own market data, which is captured from our daily interactions with clients, partners, and prospects, I feel that there will be a rise in the number of new money service business setups in the UK and these setups will be subsidiaries of established MTOs and banks in the Gulf and Africa.
A number of challenger banks and FX companies are providing bank account solutions to remittance players which will see a rise in remittance volumes from smaller fintech players.
I think cryptocurrency exchanges will increase but the data doesn’t demonstrate any significant increase in partnerships between MTOs and cryptocurrency exchanges. I think these partnerships will take a while to take form as the current mindset continues to evolve.
There are so many traditional MTOs just beginning to delve into digital remittances. Every traditional MTO I know is looking at adding the mobile channel to their business model, which is a sign we will witness a record number of traditional MTOs in the UK launching digital channels.
I also see a number of foreign MTOs coming to the UK to set up correspondent banking relationships here. The idea is to set up these relationships and get payment institution licenses with the intention of moving further west.
Investment in the UK fintech space saw record numbers smashed in 2018. 2019 continued to see much more private equity investment as opposed to venture capitalist investment. This basically implies more and more fintechs will attempt to scale up this year.
I strongly feel that the remittance and payments markets will converge soon and the industry shows signs of great resurgence and buoyancy. There is a lot of optimism in the air with the advent of new technologies that the regulators and banks are beginning to appreciate and understand, though there is still some way to go.
Regtech is the new buzzword and we will witness several Regtech solutions come out from the UK, making use of technologies, FX companies, and MTOs.
Companies providing end to end solutions in this space will be the long term winners as they will bring together a range of players in the equation.
The role of payout aggregators is also a space to watch as they consolidate their networks and forge partnerships with technology vendors.
Fintech requires fintech consulting firms and we will witness the first batch of fintech consulting firms appear, spawning a new parallel industry supporting the remittance and payments industries. This again is a good sign for MTOs and banks.
As regards the RemitONE organized event – IPR London – you attended last year, the data is available at https://www.remitone.com/remitonerapids/markettrends/