In the latest Finetch Interview I caught up with one of the founders of cross border money exchange company InstaReM.
Co-founder Prajit Nanu told me that the idea for the company came about during the organisation of a bachelor party.
“Back in 2013 in India one of my close friends wanted me to organise a bachelor party. found a villa for ten of us in Thailand but I couldn’t pay for it because I was living in India and needed to send money to Thiailand.”
He said his only option was to send a bank transfer, which was very difficult and involved lots of paperwork. “This got me thinking what to do.”
He updated Facebook and asked people if they had moved money the way he needed to.
“I was really wondering which company would be the best to do it with. But a friend of mine said he was sending money from Thailand to India so why not swap money?”
So the concept for InstaReM was born. At the same time it ruined the bachelor party for Nanu, who spent the entire time by the pool wondering if the business idea could be scaled and whether it is legal. “As you can imagine I had a horrible bachelor party,” he said. “But I realised it was important to figure out the potential business model.” At least he remembered the idea.
Meanwhile Nanu’s friend Michael Bermingham, was working in London and sending money to the US. “We had a conversation about the process and how much it costs. Eventually we decided to set up a business together.”
InstaRem, which is focused on Asia, was first set up in Australia with a headquarters in Singapore. “With $10,000 in our bank account we applied for and got a money transfer licence in Australia,” said Nanu.
During the whole of 2014 the partners built the InstaReM platform, writing the code themselves, and launched it in February 2015.
The platform, which is web and app based, can be used by consumers on their smartphones and banks also use it at the back end to move money in South East Asia. “The enterprise business is becoming bigger than our consumer business,” said Nanu
“Banks traditionally use SWIFT to transfer money between countries but this means three or four different banks become involved and all take a share of commission. We have connected banks onto local payment systems without using any other banks. For example we can connect a Malaysian bank to the UK’s Faster Payments system.”
InstaRem currently processes a couple of million transactions a year through payments corridors between countries in Asia Pacific
Nanu said he expects transactions to be worth a total of about $5bn in the last year. InstaRem make its money by taking a commission on every transfer.
InstaRem now has about 220 staff in 25 countries including Australia, Singapore, Hong Kong, Malaysia, India, US, Canada and in Europe. It is applying for licences in Japan and Indonesia. Most of its staff are in Mumbai, India and Lithuania, where the platform development and support is provided.
Read the previous fintech interviews
Part 12 Eucaps, Part 11 AimBrain, Part 10 Meniga, Part 9 TrueLayer, Part 8 InvestCloud, Part 7 ClauseMatch, Part 6 Rebuilding Society, Part 5 Honcho, Part 4 Akoni, Part 3 Wrisk, Part 2 CreditLadder, Part 1 Taina Technology