Our international finance and crypto prowess has led the Magic City to become a hotspot for innovators working to make it easier to send money abroad
By Riley Kaminer
We live in an increasingly digital world. In a context where almost 85% of tech companies are either fully remote or hybrid, it is more common than ever to have co-workers spanning across the globe. In turn, that has led to a rising trend of ‘digital nomads’ who hop from country to country while they work virtually. And of course, it is more common than ever to live abroad – and to have family and friends residing in another country.
But there is one common issue that ties all of these trends together: transferring money from one country to another.
Long story short, it’s complicated – nothing like the quick Zelle or Venmo transactions we have become used to in the US.
Increasingly, Miami startups are working to facilitate payments across borders. And some of our companies are making waves internationally in the space. We will get to that.
But first, why is this happening in Miami?
There are three main reasons why it is no surprise for Miami to become a global hub for cross-border payment innovation.
1. We are one of the most international cities in the US, giving us firsthand awareness of the magnitude of this problem.
Over two thirds of Miamians were born outside of the US. We constantly come into contact with people from all around the world. We may even have friends and family who have forked over commissions of 30% or more to send money across borders through traditional providers such as Western Union. In short: We’re aware of the problem, and have a vested interest in solving it.
2. We are an emerging fintech and crypto powerhouse.
Since the days of Miami mayor Maurice Ferré, Miami has planted a flag as a hub for international finance. With fintech now gaining prominence in this once-staid industry, Miami has continued to grow as a place for fintech pioneers – many of whom are now turning to solve the stubborn issue of cross-border payment processing.
Our connections to Latin America’s financial and investment ecosystems are particularly crucial, providing shelter for the region’s prominent families and businesses to weather economic storms. Latin America’s growing middle class has led to a boom in fintech, with Miami poised to reap the benefits.
One of the major ways cross-border payment companies are providing lower-cost, more efficient remittances is by leveraging cryptocurrencies and blockchain technology. As the so-called Crypto Capital, Miami also stands to gain from this increased usage of digital currencies.
3. Our growth as an innovation hotspot has coincided with the increased prominence of cross-border payment startups.
There is also an element of right place, right time to this story. As Miami has risen to global prominence as a major hub for tech, so has there been a proliferation of startups active in the cross-border payments space. However, our unique take on the space could see Miami take a protagonistic role in cross-border going forward – especially if crypto continues to play a major role in the cross-border payments industry.
Which Miami companies are pioneering the cross-border payments space?
There is a diverse set of Miami startups attempting to tackle these cross-border woes. But here is a representative sample of some of the highest profile companies innovating in the sector.
Cross-border Miami tech startups have recently raised major capital
Ping just raised a $15 million seed round from Y-Combinator among others to build out their global payments platform, which the company launched four months ago. This allows any individual or company to create a free account to receive US dollars, no matter whether these funds originate in a foreign currency or crypto.
“We established a platform that ultimately helps democratize access to higher paid jobs as a result of remote work,” said co-founder and CEO Pablo Orlando. “Ping enables freelancers and contractors globally to see the possibility of earning in dollars and saving in an account in the USA as the highest possible dream.”
In September, migrant-focused neobank MAJORITY landed a $37.5 million Series B fundraise led by Peter Thiel-backed Valar Ventures to double down on its South Florida presence. The Swedish company has half of its 90 full-time employees in the US, about 10 of which are in Florida.
MAJORITY provides bank accounts, debits cards, international money transfers, and discounted international calling services. Users are able to register without a social security number – an international ID and proof of US residence will suffice.
“We’re quite excited to have our US headquarters here in Miami, the place with the highest number of foreign born people,” MAJORITY co-founder and CEO Magnus Larsson told Refresh Miami.
Also in September, cross-border payment platform Payall snagged a $10M seed round led by a16z. The startup sells white-labeled software to banks, enabling them to offer quick and inexpensive cross-border payments while mitigating the accompanying risks.
“We want to make sure that the product is inclusive – and that banks can deliver money efficiently to anybody on the planet, even if they don’t have a bank account, and in near real time and at a fraction of the cost of the normal cross-border product through a bank,” said Payall president, CEO, and chairman Gary Palmer.
Many Miami cross-border payment companies continue to quietly build
Miami startup CashQ is on a mission to make cross-border payments as frictionless and inexpensive as sending a Zelle. The company has developed an embedded remittance platform that aims to make money transfer instant – and as simple as typing in a phone or credit card number.
CashQ’s main clients include traditional banks and credit unions. Their system plugs right into their client’s applications. That enables users to transfer funds to bank accounts, bank cards, e-wallets, and crypto wallets instantly. Banks appreciate CashQ’s platform because it provides them with an additional revenue stream and a way to further engage their current users. [CashQ Co-founder and COO Arina Anapolskaya is pictured at the top of this post]
Meanwhile, Finnt has developed a platform to help international family members support each other financially. Using Finnt’s digital asset and blockchain powered technology, families can set up joint savings accounts that come with inflation-beating interest rates. Similarly, Alfred Pay is working to make remittances cheaper and quicker by using crypto.
Miami startup OKY is innovating in the remittances space – moving past cash to provide in-kind payments to foreign friends and family. UK fintech Paysend opened their US headquarters in Miami earlier this year. The company enables cross-border and local payments through their proprietary global network of banks, international and local payment systems, and partnerships with card processing networks.
Brazilian cross-border enterprise payment platform EBANX also has its sights set on growth in South Florida. The 650-person company just hired a Miami-based chief product officer/CTO, with plans to rapidly grow their local footprint in 2023. “Miami is a very good hub for EBANX,” the company’s VP Global Merchant Success, Paulo Shargorodsky, told Refresh Miami, since it allows for easy access to both the US and Latin American markets.
Broward-born Clockout also has plans to get in the mix, enabling workers to divert some of their daily wages directly to their families abroad; while Ontop, which raised a $20 million Series A last year, continues to grow their platform that enables companies to hire international remote workers legally and pay them easily.
Continue following us at Refresh Miami to learn the latest about how Miami is excelling in the cross-border payments space!
READ MORE IN REFRESH MIAMI:
- Fueled by $15M fundraise, Ping takes the sting out of getting paid in USD or crypto
- Why is South Florida becoming a hub for FinTech?
- MAJORITY expands Florida footprint, with $37.5M Series B in tow
- Cross-border payment platform Payall snags $10M seed led by a16z
- Finnt raises $3.5M seed to help cross-border families send, save, and spend money
- With CashQ, international money transfers are as simple as sending a text
- Meet the FIU grad who’s making remittances cheaper and quicker by using crypto
