Cash despatched residence by migrant employees not solely helps their households, but in addition permits complete economies to develop. However transferring cash comes at a excessive price to employees, with remittance charges averaging about 6.5%. MyZoi needs to chop charges by greater than half, beginning with the 5 million low-income migrant employees within the United Arab Emirates.
MyZoi (which suggests “my life” in Greek) introduced right this moment it has raised $14 million from SC Ventures, a unit of Normal Chartered, and Japanese monetary providers group SBI Holdings. It holds two regulatory licenses from the Central Financial institution of the UAE and is a wholly-owned subsidiary of Normal Chartered Financial institution.
The startup has two core choices. The primary is a digital remittance service that may cut back transaction prices to lower than 3%, in keeping with merchandise 10c of the United Nation’s Sustainable Growth Objectives 2030. The second is a payroll system created particularly for corporations that make use of migrant employees.
MyZoi co-founder and chief product officer Christian Buchholz first got here up with the concept for the platform and incubated it beneath SC Ventures. Earlier than beginning myZoi, Buchholz spent 5 years main SC Ventures’ design and innovation initiatives throughout a number of areas. Throughout that point, he stated he talked to many low-migrant employees and located that they usually remit as much as 80% of their earnings to relations again residence, and have little or no cash left for private use or financial savings.
Buchholz was launched to his co-founder, CEO Syed Muhammed Ali, by SC Ventures, to show the idea right into a industrial enterprise with UAE as its pilot market. The 2 continued to do analysis concerning the issues migrant employees and their employers face.
Nabid Hassan, myZoi product lead and co-founder; Syed Muhammad Ali, CEO and co-founder; Christian Buchholz, CPO and co-founder; Shanawaz Rouf, CCO and co-founder
“Low-income migrant employees are basically locked out of the formal monetary system,” Ali informed TechCrunch. “Providers presently provided to them are neither joined up nor developed with their wants and capabilities in thoughts.”
In consequence, many migrant employees flip to cash-based or casual strategies of sending money residence. For instance, the myZoi workforce spoke with one girl who labored as a home helper and often despatched cash residence to her household. Since she didn’t have a checking account, she relied on her uncle as an middleman to distribute the cash. However she discovered that her uncle hadn’t shared these funds together with her relations.
Ali stated that many employers needs “compliant and easy options which can be price efficient with a robust social impression,” whereas their employees want a “really inclusive, complete and fit-for-purpose monetary service that would allow them to fulfill their fundamental transactional in addition to long run monetary wants.” MyZoi plans to cowl all of that by working on a B2B2C mannequin, with payroll options for employers, remittance providers for his or her migrant workforce and monetary literacy supplies.
Ali stated one problem myZoi needs to unravel is the mistrust many migrant employees have of economic providers, particularly digital ones. The app is designed for individuals with low ranges of economic literacy and “based mostly on in depth analysis and human-centered design ideas.” Customers obtain their salaries straight into their myZoi digital wallets and might ship cash from there with the contact of a button.
MyZoi will be capable of maintain remittance prices down due to its digital-only mannequin, which suggests it is ready to run comparatively lean operations and reduce overheads, Ali stated. It’s also constructing its personal rails to restrict transaction prices in key corridors.
For employers, myZoi needs to unravel the friction of methods that require paper-based onboarding of every worker and have hidden expenses. Ali stated many employers “would additionally wish to see just a little extra empathy in direction of the challenges their staff face in utilizing monetary providers.”
The purchasers myZoi will serve vary in dimension from a number of hundred staff to greater than 10,000 throughout totally different industries like oil and gasoline, medical, hospitality, building and retail.
Ali stated that myZoi will differentiate from different payroll options as a result of it was created for low-income employees. A bonus for employers is that myZoi requires no technical integration or in depth paperwork to start out utilizing. As an alternative, its person onboarding course of is totally digital. MyZoi will primarily serve employees from Pakistan, India, Bangladesh, the Philippines and Nepal.
In a press release concerning the funding, SC Ventures member Gautam Jain stated, “There are over 1.4 billion unbanked people globally. At SC Ventures, we spend money on progressive enterprise fashions like myZoi so we will higher serve the communities we function in. We imagine that fintech improvements similar to myZoi are rising because the catalyst for change. They’re constructing an ecosystem that delivers easy but significant options to low-income migrant employees, whereas providing a commercially viable and socially impactful proposition.”
