(We originally posted this in 2020. You can read more of our original ideas in our archive.)
Problem: The remittances market is more than three times greater than the aid developing market at $550B in 2019; however, it is easy to get scammed or have funds misused while sending remittances.
Solution: For those who may not know, it is helpful to start with a definition of remittances.
A remittance is a transfer of money, often by a foreign worker to an individual in their home country. Money is sent home by migrants competes with international aid as one of the largest financial inflows to developing countries. Workers' remittances are a significant part of international capital flows, especially with regard to labor-exporting countries.
This “shadow market” has largely gone unnoticed in the financial technology world, but has many areas for clear optimization and growth. I propose a service (similar to WorldRemit) where users can send remittances in the form of goods or services to people or family in developing countries (e.g. drives, housemaids, food deliveries, etc.). Traditionally, remittances are thought of as cold hard cash gifts. The problem with this is that cash can often be misused and people can be scammed into sending large amounts of cash (RE the many emails of people who claim to be a “Nigerian Prince”). In contrast, a service-based, goods-based, or physical remittance system would reduce scamming while also proving more efficient and effective. Moreover, such a system would help bolster local economies and reduce the wide spread “fraud” that has trailed the name of development for decades.
Monetization: Percentage of services paid for through the app.
Contributed by: Michael Bervell (Billion Dollar Startup Ideas)