JiPay throws in the towel

Singapore-based remittance app JiPay is being wound down.

CEO Dayana Yermolayeva broke the news on LinkedIn.

Why it matters: You rarely get honesty like this. Read it and wonder what might have been.

Yermolayeva said:

“I decided to wind down JiPay.

We didn’t run out of money and we weren’t struggling to grow. In fact, in August our remittance volumes and revenues grew by 300% MoM and continued to rise in September.

That’s what made this decision so much harder. But here’s why I did it:

(1) We realised that employers don’t convert their helpers.
JiPay’s model was based on targeting households with an expense management solution to then bring on board their helpers and offer them personal finance products.
• We learned that en-masse, helpers don’t take financial advice from their employers.
• Only 3% of helpers using the JiPay Family (employer) card were converting to using JiPay Personal. Mainly, it’s because helpers don’t want to keep their money in the same place where their employer has theirs.

(2) JiPay Family was not viable on it’s own:
• Our main revenue stream here was interchange, which is a bad monetisation strategy.
• Also, the thing that made our volumes grow was cashback, but cashback-led growth never sat right with me. It wasted a lot of money, created little loyalty, and attracted far too many cashback gamers, a unique human species.

(3) We considered cutting the employer product and doubling down on migrant worker finances, but this approach had some flaws:
• Losing the employers meant we lost a) market size and b) the ability to collect payroll to provide helpers earned wage access solutions.
• JiPay would become “just a remittance app”, where we would have no moat given low margins, high partner reliance (no license), and the fact that Singapore is integrating its QR payment system with Indonesia and Philippines.

(4) We zoomed out and began experimenting with other ways we could provide financial independence to migrant workers.
• We looked at products like micro insurance and bill payments, but those just did not move the needle in terms of ARPU.

At the end it was down to simple maths. Given our current funding, we would not generate enough remittance revenue in Singapore to raise our Series A, while expanding to our next market, the UAE, would require far more investment.

Unfortunately, this means that my amazing team will soon be looking for new roles, so if you’re on the hunt for some superstars, check out their profiles here: https://bit.ly/3rKUe8W

It’s been a difficult few weeks filled with questions and ambiguity but I want to say thank you to my investors and team for supporting me every step of the way. “