Cash despatched dwelling by migrant employees not solely helps their households, but in addition allows total economies to develop. However transferring cash comes at a excessive price to employees, with remittance charges averaging about 6.5%. MyZoi desires to chop charges by greater than half, beginning with the 5 million low-income migrant employees within the United Arab Emirates.
MyZoi (which implies “my life” in Greek) introduced at this time it has raised $14 million from SC Ventures, a unit of Commonplace Chartered, and Japanese monetary companies group SBI Holdings. It holds two regulatory licenses from the Central Financial institution of the UAE and is a wholly-owned subsidiary of Commonplace Chartered Financial institution.
The startup has two core choices. The primary is a digital remittance service that may scale back transaction prices to lower than 3%, consistent with merchandise 10c of the United Nation’s Sustainable Improvement Objectives 2030. The second is a payroll system created particularly for firms that make use of migrant employees.
MyZoi co-founder and chief product officer Christian Buchholz first got here up with the thought for the platform and incubated it below 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 mentioned he talked to many low-migrant employees and located that they usually remit as much as 80% of their revenue to kinfolk again dwelling, 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 business 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 primarily locked out of the formal monetary system,” Ali instructed TechCrunch. “Companies presently supplied to them are neither joined up nor developed with their wants and capabilities in thoughts.”
Consequently, many migrant employees flip to cash-based or casual strategies of sending money dwelling. For instance, the myZoi staff spoke with one girl who labored as a home helper and repeatedly despatched cash dwelling 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 along with her kinfolk.
Ali mentioned that many employers desires “compliant and easy options which are price efficient with a robust social affect,” whereas their employees want a “actually inclusive, complete and fit-for-purpose monetary service that might allow them to satisfy 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 companies for his or her migrant workforce and monetary literacy supplies.
Ali mentioned one problem myZoi desires to unravel is the mistrust many migrant employees have of monetary companies, particularly digital ones. The app is designed for folks with low ranges of monetary literacy and “primarily based on in depth analysis and human-centered design rules.” Customers obtain their salaries instantly into their myZoi digital wallets and might ship cash from there with the contact of a button.
MyZoi will have the ability to maintain remittance prices down due to its digital-only mannequin, which implies it is ready to run comparatively lean operations and decrease overheads, Ali mentioned. It is usually constructing its personal rails to restrict transaction prices in key corridors.
For employers, myZoi desires to unravel the friction of methods that require paper-based onboarding of every worker and have hidden expenses. Ali mentioned many employers “would additionally prefer to see just a little extra empathy in direction of the challenges their staff face in utilizing monetary companies.”
The purchasers myZoi will serve vary in dimension from a couple of hundred staff to greater than 10,000 throughout totally different industries like oil and gasoline, medical, hospitality, development and retail.
Ali mentioned 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 a substitute, its consumer onboarding course of is completely digital. MyZoi will primarily serve employees from Pakistan, India, Bangladesh, the Philippines and Nepal.
In an announcement concerning the funding, SC Ventures member Gautam Jain mentioned, “There are over 1.4 billion unbanked people globally. At SC Ventures, we put money into revolutionary enterprise fashions like myZoi so we will higher serve the communities we function in. We consider that fintech improvements comparable 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.”