Remitly, a Seattle-based firm that provides international remittances and digital financial services for immigrants, has added new banking features in its money management app Passbook. Launched early last year, Passbook aims to simplify the process of opening and using a bank account for immigrants in the U.S. by eliminating banking fees, accepting alternative forms of identification, and facilitating international money transfers.
New features introduced in the Passbook app allow customers to spend, send and save money with more flexibility. Users can get themselves verified digitally through forms of identification common to immigrants, such as a passport or other foreign government-issued ID like the Matricula Consular ID. Passbook users can now also make online transactions with their Passbook Visa debit card within minutes of opening an account, even if they haven’t yet received their physical Visa card.
Another new feature is Early Payday, which makes direct deposits accessible for users up to two days before their actual payday. The new functionality also allows users to transfer funds overseas to other account holders on the app instantly and free of cost.
The digital banking services on the Passbook app are offered through a bank account issued by Sunrise Banks, a Certified B Corp and partner bank with experience working for immigrant communities through initiatives such as the Open Door Mortgage Program. The bank has previously issued prepaid debit cards for AT&T Small Business, Boost Mobile, and Relay.
John Scrofano, vice president of Passbook, says Remitly’s customers have different habits, emotions, and experiences associated with money management as compared to individuals born in the US.
“For so many, the process of opening a bank account or sending money home to loved ones is often difficult. Between high fees, restrictive documentation requirements and an array of hidden costs, immigrants have long been disadvantaged by traditional financial services,” said Scrofano. “We believe the work we’ve done to improve Passbook is important progress toward making financial services more accessible for immigrants while addressing the distinct challenges they face.”
Scrofano says the new features will allow customers to navigate financial bumps such as late fees and unexpected bills with less stress and fewer dollars wasted. “When an urgent need arises for an immigrant or one of their family members overseas that could impact them financially, the early access to funds via Early Payday and the ability to provide support quickly through P2P payments would be critical”, he said.
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Scrofano also points out that when it comes to peer-to-peer money transfers, most of Remitly’s competitors require a Social Security number to fully use their feature set. Without an SSN, they create lower limits and leave customers in an “unverified” status. Passbook P2P transfers, however, don’t limit functionality based on the documents used to sign up.
The U.S. is home to approximately 45 million immigrants – the largest number for any country in the world – representing more than one in every six workers. However, the financial needs of immigrants are often overlooked by traditional banks and financial institutions, according to Amir Hemmat, co-founder and CEO of Welcome Tech, a digital platform that offers information and resources across finance, education, and technology to help immigrants thrive in a new country.
Hemmat says traditional financial services and practices in the U.S. are geared towards consumers who are born and bred in the country. “Our financial systems make a lot of assumptions as to what characteristics potential customers have and don’t have – the language they speak, the cultural ethos they practice, and their financial literacy – with little room for deviance,” he said. “They often neglect immigrants because their approach is based on a ‘one size fits all’ model, and more often than not, informed by unconscious bias and discriminatory practices.”
Fintechs are stepping up to fill this void left by traditional banks. Swedish fintech Majority, which provides mobile banking solutions for immigrants, recently launched in the U.S. and secured $19 million in seed funding. Established players such as Wise are also increasingly focusing on simplifying cross-border transfers for immigrants.
These digital financial platforms offer much-needed alternatives for immigrants who have been underserved by traditional banks and credit unions. Andrew Latham, a certified personal finance counselor and the managing editor of SuperMoney, says the Passbook app and its new features could make financial services more inclusive and accessible for U.S. immigrants.
“Passbook could help introduce immigrants and unbanked consumers to many perks that are often inaccessible to them, such as free and efficient money management, instant fund transfers, and early access to pay – all on a platform that immigrants trust and are comfortable with, because many of them already use Remitly’s services to send money home.”