Local financial technology start-up Fastacash has developed a remittance app to target the global US$685 billion (S$954 billion) money transfer market.
Called Xopo, the app allows consumers to use different social networks for cross-border money transfers. While other social networks, such as Facebook and Snapchat, have their own remittance app, Xopo is the first one that works across social networks.
Consumers can use Xopo on Twitter, WhatsApp, Facebook and WeChat. Other social networks will be added in coming months.
A sender, who will need a debit card, downloads the Xopo app on his Apple iPhone or Android device. He selects his friend from the social channels they are connected to and enters how much money he wants to send to the recipient, who must also have the Xopo app.
Recipients will be able to get their money from the offices of Xpress Money, a global money transfer firm with outlets in 150 countries. Fastacash is partnering and co-branding Xopo with Xpress Money to launch the global service.
Xopo, which has embedded security features that make individual transactions unique and accessible by only the intended receiver, is available to consumers in Britain from today.
Fastacash chairman and chief executive Vince Tallent told The Straits Times that it chose Britain for the global launch because it has two of the largest money transfer "corridors" in the world. "Annually, people in Britain send over US$7 billion to India and Nigeria. Potentially, this is a large market for us," he noted.
Remittances can be made from Britain to 17 countries, including India, Pakistan, the Philippines and Nigeria. The service is one-way for now, said Mr Tallent, but a two-way service will be rolled out in coming months. Other countries, such as Australia, will be added to the service soon.
"People around the world are communicating with their families and loved ones on social networks such as Twitter. So why not make money transfers available on these platforms?" said Mr Tallent. Current solutions allow consumers to send money only to users in the same social network. Xopo seeks to let consumers use the same app across social networks, he added.
Instead of going to the banks, users can use social networks on their mobile phones for transfers, a move that breaks new ground.
Xopo charges a flat fee of £2.99 (S$6.40), regardless of the transaction size. According to the World Bank, sending money from Britain to the Philippines, for example, can cost between £4.56 and £14.20.
Social media is being touted as a better way to effect remittances as it directly connects senders and beneficiaries. The World Bank estimates that more than 90 per cent of transfers are sent to family members - people who are usually connected on social media.
Industry analyst Ng Zhi Ying said Fastacash's biggest challenge will be getting customers to adopt Xopo. They will have to be convinced that the service provides faster money transfers and is more convenient, simpler and secure to use, said Ms Ng, who is from research firm Forrester.
"While consumers are comfortable with using social networks to communicate and for entertainment, not all feel at ease transacting on these platforms," she added.
Fastacash has received about US$24 million in funding to date. Its investors includeSpring SEEDS Capital and local venture capital firm Jungle Ventures.
Correction note: An earlier version of this story said that Fastacash's investors included the National Research Foundation. Spring SEEDS Capital should have been included instead. We are sorry for the error.