Lala World, a Singapore-based blockchain startup, closed a $2 million Series A funding round designed to bring financial services to the unbanked across developing markets. The identities of the inves
Lala World, a Singapore-based blockchain startup, closed a $2 million Series A funding round designed to bring financial services to the unbanked across developing markets. The identities of the investors backing the round were not disclosed.
The company operates a wallet built on Ethereum and Hyperledger that handles peer-to-peer transfers, global remittances, local and international bill payments, and peer-to-peer lending between users. A Lala payment card will connect to the digital wallet, allowing access to the system from both physical and digital channels. Lala World's core mission involves embedding blockchain technology and cryptocurrencies within the existing financial framework, creating a distinct ecosystem that removes intermediaries from financial transactions.
Migrant workers currently face around 10% in commissions and fees when sending money home to family. Lala World is pursuing a different model: using blockchain to reduce those costs to under 1% per transaction, making remittances far more affordable for working families.
Sankalp Shangari, Lala World's founder and CEO, outlined the difficulties his target market encounters: "The majority of the underbanked face severe challenges as they lack basic banking education. Sending pay-checks to their hometown would take weeks and to compound matters, they have to pay various charges, which can be pretty hefty."
Shangari continued: "In the past 20 years, while the world has changed and the Internet has transformed things, the travails migrant workers go through are still the same. I know what they went through and that's why I started Lala World."
Lala World has negotiated various partnerships across Asia, Africa, the Middle East and Europe. The company is conducting trials with users in Malaysia and India and targets onboarding 500,000 migrant workers in Malaysia over the next 12 months. Beyond the Series A, Lala World is planning a pre-ICO to fund continued development.
Across the world, two billion people lack access to formal banking services, with more than half of adults in the poorest households unable to access traditional banking, according to World Bank data. Financial inclusion—when individuals and businesses can access affordable, useful financial products suited to their needs—serves as a foundation for reducing poverty and spurring economic development. Jim Yong Kim, president of the World Bank Group, has pushed for Universal Financial Access to be achieved by 2020.
Blockchain and mobile technology are opening new paths to financial inclusion in developing regions. Mobile payment solutions create access points for populations previously shut out of traditional banking. With blockchain, payments and remittances settle in days instead of weeks, so people access their capital when they need it.
Stellar, an open-source payment network built on blockchain, has become financial infrastructure for nonprofits and businesses serving the developing world. The Praekelt Foundation incorporated Stellar into Vumi, its messaging platform, enabling young women in Sub-Saharan Africa to build savings through mobile airtime credits. In Nigeria, Parkway, a licensed mobile money operator, runs on Stellar's network and links the country's five major telecommunications carriers, allowing users of different mobile money services to transfer funds to one another. By December 2016, Lala World had announced new partnerships across the Philippines, India and West Africa.
