September 19, 2013
At the age of 16 I found myself signing up for a freelance part time job to write articles for a fantasy fiction (not really Harry potter) website. At some point, I realized that I did not possess an account, and I could not create a PayPal account to receive payments for my work. As a freelancer, though, the pay was meager and the trouble I had to go through to get my cash made me nearly quit freelancing as a career option. I am not 16 anymore but while researching on this problem, I found out about Qwikwire. According to Payments startup Qwikwire, they seek to assist freelancers in emerging markets to easily participate in opportunities by providing storage, transmission and payment service.
Qwikwire was found in November, 2011 by Ray Edison Refundo (Formerly Financial analyst at Lam Research), Scott Yu (Ex Senior Associate at Deloitte), Jason Foldi (Ex Financial Analyst, Geeknet) and Bing Tan. On 29th August 2013, Qwikwire received an amount of $11,700 in seed funding from JFDI.Asia.
After nearly 8 months of planning and development, Qwikwire began its Beta testing in May, 2013. 500 freelancers across Philippines participated who were active on marketplaces like oDesk and Elance. To pick up cash the tester has to reach out to one of Qwikwire’s partners (Banks like BDO or pawnshops like Cebuana Lhuillier) by showing a valid ID along with the transaction code. Beta Testers were also eligible for accessing additional benefits such as discounts, coupons etc.
According to what I have seen, freelancers require tools and services that make them work efficiently so they can focus on providing quality service to their clients. Most of the times logistics is the biggest deterrent. According to the Co-founders, service providers can sign up within a few minutes and receive payments within 2 hours of dispatch. For a freelancer to recieve a payment, all he has to do is send a link to the client, who will have to log onto Qwikwire.com to make a payment. The money is transferred to the freelancers bank account or can be picked up at a location (such as a pawnshop) for those without banking facility. Another alternative offered by Qwikwire to the freelancers is the availability of cash cards as payments for withdrawing money through ATM’s.
Prior arrangements have been made with BDO, a major full service bank in the Philippines and two underwriting banks in the US. BDO has 760 branches across Philippines. This enables Qwikwire to accept bank transfer for the people who have a US routing number and payments through electronics checking capability. Also, Qwikwire works with buyers around the world, and uses VISA and MasterCard network. Initially, the startup is rolling out its services only for freelancers in Philippines.
The major players in the payments space for freelancers include oDesk, Elance and Remote Staff (in Philippines). Remote Staff, an Australian company founded in 2007 is now a PEZA accredited company trading under Remote Staff Inc. They hire designers, assistants, developers across philippines and other job roles that is based on the phone and internet. They work with upto 50 home based Filipino’s every month. Remote Staff plans to equip itself with 1000 staff members by 2013.
LTP View: It might be challenging for a startup like Qwikwire to setup partnerships with banks in various countries considering the regulatory challenges. Qwikwire’s new payment system might work well for freelancers and the underbanked in the Philippines to receive their payments with less hassle. The freelance market is growing at a very past pace. According to Knowledgefaber, the freelancer (temp jobs through portals like oDesk) talent market is estimated to grow at more than 30% CAGR over the next 5 years and Qwikwire is certainly offering a solution that can become a catalyst in its growth.