Sylvia Duruson
dLocal, a Uruguayan cross-border payment platform, has forged a partnership with iTransfer, a money remittance company. Their collaboration aims to address the complexities of cross-border payments in emerging markets, with a focus on mitigating currency risks and enhancing transfer efficiency.
The partnership’s primary objectives include offering competitive rates, providing real-time currency updates, and increasing flexibility for end-users. Initially, the service will support bank transfers and wallet payments in Nigeria, the Philippines, and Pakistan. dLocal has outlined plans to expand this offering to Bangladesh, Morocco, Egypt, and India in the future.
dLocal’s platform connects enterprise merchants with consumers across Africa, Asia, and Latin America. It facilitates payment acceptance, payouts, and fund settlements. The fintech company has established a presence in multiple regions, including over 10 countries in Africa and the Middle East. Notable markets include Kenya, South Africa, Nigeria, and Turkey. dLocal reported processing $17.7 billion in payments in 2023.
Recent financial reports show dLocal’s continued growth. Q1 2024 saw a total payment volume of $5.3 billion, marking a 49% year-over-year increase and a 4% quarter-over-quarter rise. Revenue for the same period reached $184 million, up 34% year-over-year but down 2% quarter-over-quarter.
Currency volatility remains a significant challenge in emerging markets. Fluctuations can impact real-time transfer values, affecting the final amount received by beneficiaries. This partnership aims to address these issues directly.
Marcela Gonzalez, CEO of iTransfer, emphasized the importance of competitive rates in supporting financial needs across emerging markets. iTransfer, with its strong presence in EMEA, Latin America, and APAC regions, views this collaboration as aligned with its growth and expansion strategy. Gonzalez highlighted that integrating dLocal’s payment infrastructure will significantly enhance the remittance experience for iTransfer users.
Agustin Botta, Head of EMEA at dLocal, framed the partnership as a demonstration of their commitment to innovation and equitable access to financial services. He stressed the importance of addressing the specific needs of cross-border payments in volatile markets.
This collaboration is part of a broader trend of partnerships for dLocal. Recently, the company joined forces with KCB Bank in Kenya to enable real-time disbursements into all Kenyan bank accounts for its global customers.
The expansion of Latin American fintechs into Africa is gaining momentum. Minka, a Colombian fintech, launched operations in East Africa in July 2024, covering Kenya, Tanzania, Uganda, and Ethiopia. The company plans to extend its reach to Southern African countries including Mozambique, Zambia, and Malawi.
These developments underscore the growing interconnectedness of global financial markets and the increasing focus on addressing the unique challenges faced by emerging economies. As cross-border payment platforms continue to evolve and expand their reach, they play a crucial role in facilitating international transactions and supporting economic growth in developing regions.
The partnership between dLocal and iTransfer represents a significant step towards improving financial services in emerging markets. By combining their expertise and resources, these companies aim to create more efficient, reliable, and user-friendly cross-border payment solutions. This collaboration could potentially set a precedent for future partnerships in the fintech industry, particularly those focused on serving emerging markets.
