A Cheaper Way to Send Money Home

When Ismail Ahmed moved to London’s outskirts in the late 1980s, sending money home to his family in Somaliland required a trip to a broker’s shop in the city, a 10 percent remittance fee, and anxiety over when the money would arrive. “I saw firsthand how costly and inconvenient it was for hardworking migrants,” says Ahmed, who worked his way to a Ph.D. and a job at the United Nations, where he advised companies on compliance with anti-money-laundering rules. In 2010, while earning an MBA, he cut out the middleman by becoming one himself.

Ahmed founded WorldRemit, one of dozens of startups running websites and apps that promise cheaper, easier ways to transfer money abroad. The World Bank estimates that remittance senders paid banks and courier services an average 8 percent of the $583 billion they sent across national borders last year. To send upwards of $1,000, WorldRemit and its digital competitors take 1.3 percent or less, says Daniel Webber, managing director of researcher FXcompared.com. “There’s definitely good money to be saved,” he says.