Money transfer company TransferWise has begun processing international payments into Asian digital wallets in a move that its CEO says reflects their growing use as an alternative bank account.
E-wallets, which allow users to make cash transfers using their mobile phones, are widely used in many Asian markets.
TransferWise’s move in the Philippines and Indonesia is a shift in how the company does business in Asia, as in most other countries it provides cross-border payments only between bank accounts, Chief Executive Officer Kristo Käärmann said in an interview.
“It’s a recognition that maybe in the future we will view wallets the same as bank accounts,” he said.
The whole of Southeast Asia has more than 150 digital wallets fighting for market share and there are more in India, China and South Korea, where the industry is more mature and more consolidated.
International players are also looking to the region. WhatsApp is considering linking up with e-wallets in Indonesia to provide mobile payments, its second market for payments after India, Reuters has reported, citing sources.
“We chose to begin in the markets where the ratio of bank accounts to wallets is most significant, and started with the wallets that are most used,” said Käärmann.
He added that TransferWise, one of Europe’s best-funded financial technology firms, was considering expanding into other Asian markets including China and India.
TransferWise will initially allow payments to three e-wallets in Indonesia — GoPay, run by GoJek, the Indonesian ride hailer turned super app; OVO, backed by GoJek’s arch rival Singapore’s Grab; and DANA, backed by Ant Financial, an affiliate of Alibaba.
In the Philippines, TransferWise users can make payments to wallets run by GCash, which is also backed by Ant Financial, and PayMaya, which is backed by Tencent, and in Bangladesh to BKash, the country’s largest mobile financial services provider.
The six collectively have 150 million users, according to TransferWise.
In Indonesia, 66% of the population are unbanked, as are 65% in the Philippines.
“International remittance is one of the Philippines’ key economic contributors. We always welcome opportunities to collaborate with leading global companies to make that happen,” Paolo Azzola, managing director of PayMaya Philippines, told Reuters in an email.
The other five wallet providers did not respond to a request for comment.
Initially, TransferWise will process payments only into wallets using a third party intermediary, though it would like to allow international payments out of the wallets in the future, said Käärmann.