Competitive Dynamics in Remittance Services

This chapter explores the competition between remittance companies, particularly Wise and Remitly, detailing their growth strategies, fee structures, and customer acquisition efforts. It highlights the advantages of mobile applications for user experience and discusses potential threats from neobanks and regulations such as immigration policies. The chapter also examines the impact of interest rates on revenue streams, emphasizing the importance of understanding these financial dynamics for future growth.

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In this episode of the Investing for Beginners podcast, Brett Schafer joins the discussion once again to compare Remitly and Wise, two leading companies in the remittance industry. The conversation covers their business models, market strategies, strengths, weaknesses, and competitive positioning. Listeners will learn about the growth trajectories of both companies, the role of technology in their services, and potential future developments, including the impact of stablecoins. Brett also offers insights into the valuations and business potentials of both companies.

00:00 Introduction and Overview

00:38 Remitly vs Wise: Business Models and Market Share

01:22 How Remitly and Wise Operate

04:16 Market Competition and Growth

18:11 Cost Structures and Take Rates

24:22 Potential Risks and Challenges

25:52 Remitly's Challenges and Comparisons with Wise

29:25 Impact of Stable Coins on Remitly and Wise

29:38 Understanding Stable Coins and Their Role in Payments

31:03 On-Ramp and Off-Ramp Challenges with Stable Coins

42:18 Valuation and Investment Insights for Remitly and Wise

46:42 Product Development and Future Prospects for Remitly and Wise