Digital Wallet Corporation (DWC), a Japan-based financial technology (fintech) company, announced today that it has acquired remittance and foreign exchange firm Speed Money Transfer Philippines (SMTP) for an undisclosed amount.
SMTP, which operates in the Philippines and Australia, will be renamed as Digital Wallet Philippines following the acquisition. The deal and the name change have been approved by the country’s central bank, the Bangko Sentral ng Pilipinas (BSP).
DWC’s acquisition of a Philippines-based remittance company comes as Filipinos working abroad remitted $2.88 billion in August, slightly higher than July’s $2.87-billion tally, according to data from the BSP.
Of the total remittances in August, about $2.59 billion were sent through banks, the central bank data showed. According to the World Bank, the Philippines was the fourth-highest remittance recipient globally in 2018 at $34 billion, trailing Mexico at $36 billion, China at $67 billion and India at $79 billion.
Eiji Miyakawa, Founder and Chief Executive Officer of DWC said the company’s Philippines business aims to allow unbanked customers to benefit from financial services such as remittance, foreign exchange, and payments through their mobile devices.
“In the future, we aim to provide them access to investment projects in the Philippines through the Digital Wallet Project, offering such opportunities which would previously not have been possible,” Miyakawa said.
The Philippines acquisition is the first step in DWC’s global expansion strategy to deploy its mobile wallet services, Smiles Mobile Remittance (Smiles), to Asia and Europe, he added.
Remittances have been the Philippines’ largest source of foreign exchange income, insulating the domestic economy from external shocks by ensuring a steady supply of dollars into the system. This also means that a number of players are operating in the country to tap into the vast market opportunity.
In September, DealStreetAsia reported that Grab Financial, the financial arm of Southeast Asia’s most-valued ride-hailing startup, is looking to launch its first cross-border remittance corridor between Singapore and the Philippines in the fourth quarter of this year.
The move will allow users to remit money instantly and securely using their GrabPay wallets.
DWC will also be up against Philippines-focused blockchain remittance startup SendFriend, which raised $1.7 million in January from eight investors including MIT Media Lab, Barclays, the Mastercard Foundation, Ripple, Techstars, Mahindra Finance, 2020 Ventures, and 8 Decimal Capital.
Founded in 2017, SendFriend aims to enable Filipinos working abroad to securely transfer USD to PHP at the lowest rate available.
