Cross-border payments are in high demand throughout the globe, especially with consumers that need to send money overseas. But, according to InstaRem, one global payment service provider, about one-fifth of its client base is made up of small and medium-sized businesses.
With new funding for the firm announced Wednesday (March 16), InstaRem is likely to pick up even more traction among SMEs.
The Singapore-based firm revealed a $5 million funding round headed by Vertex Ventures, according to reports. Investors at Fullerton Financial Holdings and Global Founders Capital also participated in the Series A round, reports added.
InstaRem offers cheaper international payment services than what can be obtained with traditional banks and credit unions; the company provides cross-border transactions at often less than a 1 percent fee rate, and reports said the payments can be completed within a day.
SMEs are taking advantage of the service like consumers are, the company said.
“Some of our SME customers I thought used us for price, but one told us recently that a primary reason is because they can sit on [an] invoice longer than with a bank,” said the company’s cofounder and CEO, Prajit Nanu, in an interview with TechCrunch.
While it’s based in Singapore, InstaRem first launched to service Australian customers. Reports said the company will not disclose how many customers it has but claims it services 2 percent of demand for payments between Australia and India, for instance. So far, InstaRem holds a financial license to operate in Australia, Hong Kong and Canada, with plans to expand across Asia, Europe and the U.S.
And while competitors use an array of bank accounts that they manage across the globe to conduct these payments, InstaRem works with middle-market financial institutions that are already conducting cross-border transactions and trading in foreign currencies, according to reports.