Seattle-based remittance company Remitly Global Inc. (Nasdaq: RELY) is shutting down its Passbook digital bank account product.
Co-founder and CEO Matt Oppenheimer announced the decision Wednesday along with Remitly's fourth quarter 2022 financial results. The decision to scrap Passbook comes three years after Remitly first launched the product.
"While Passbook was gaining traction with customers and was growing, it was ultimately outside our core customer segment," Oppenheimer said on a Wednesday call with investors. "We believe it makes sense to redeploy our resources to higher-returning investments targeted at our core remittance customer. We are taking the best of learning from Passbook and integrating them into products or features to deliver greater value through innovative solutions that are directly relevant to our customers' remittance needs."
On its website, Remitly notes it is stopping Passbook services May 1 and isn't taking new accounts. Passbook debit cards will stop working April 20. Remitly launched Passbook as a bank account designed for immigrants, as the account didn't require a Social Security number. Although Remitly provided the app, Passbook's back-end banking services were provided by St. Paul, Minnesota-based Sunrise Banks.
On Thursday, Remitly announced it was expanding into the Middle East by allowing customers to send money from the United Arab Emirates. With the move, which includes opening an office in Dubai, UAE becomes the 30th country from which Remitly customers can send money.
“With one of the world’s largest populations of immigrants and the second-highest global volume of remittance originations, the UAE was a natural choice," Mohamed Mansour, head of the UAE region at Remitly, said in a release. “Moreover, the country’s advanced digitization and push towards a cashless economy makes Remitly’s platform particularly relevant."
A Remitly spokesperson said the Dubai office has three employees, out of more than 2,600 at the company. The spokesperson added that Remitly will take learnings from Passbook and apply them to its core remittance product, and the Passbook team will move to other areas of Remitly's business.
Remitly, founded in 2011, allows customers to send money internationally through a bank deposit, cash pickup or mobile wallet. The company went public on the Nasdaq in 2021. Remitly completed its $80 million acquisition of Rewire, an Israeli remittance company, in January, and Rewire now functions as Remitly Israel.
Remitly said it generated $191 million in revenue during the fourth quarter, up from $135.3 million during the fourth quarter of 2021. Its full-year revenue for 2022 was $653.6 million, up from $458.6 million in 2021.
