Thought Leaders in E-Commerce: Flywire CEO Mike Massaro (Part 3)

One Million by One Million Blog – By Sramana Mitra

Sramana Mitra interviews Flywire CEO Mike Massaro on how cross-border payments are transforming the efficiency in the sector.

Sramana Mitra: Can you walk me through the work flow? I live in India. I have a child in college at MIT. If I’m the consumer sending the wire, what is my work flow?

Mike Massaro: We work with the educational institution. Our model is that of an international payment processor for that receiver of funds. We sign an agreement with that institution and that institution integrates us into their e-billing process. As part of the notification going to the student, it will often have the amount due. They’ll be driven over to, what we call, a payment experience over at It will be branded for MIT. The consumer can select the country they’re paying fro, in your example, India. Then we share various payment methods supported in local currencies in INR, as well as credit cards and bank transfer.

In India, there’s a specific form that has to be filled out by the parents to send money abroad for education. Our platform will actually take that consumer through filling out the proper information about the student they’re paying for as well as who’s actually making the payment. We pre-populate that A2 form in India and help that parent in the submission of that form. What we’ve been able to do is build a workflow that takes consumers through the various payment options they have in their local currencies as well as customise that as there’s specific data that governments want to capture.

Sramana Mitra: I imagine that foreign exchange regulations exist in other countries. I’m certainly familiar with the Indian market. I know it’s a regulated foreign exchange market. What needs to happen? Is there a process of approval from the Reserve Bank of India or equivalent central banks in different countries that you operate before the transaction can go through?

Mike Massaro: It’s going to vary in different countries. Of course, there is foreign exchange regulation and laws. What we often do is we’re not a traditional money remittance company like Western Union. We’re a payment processor collecting on behalf of our client institution.

Sramana Mitra: I understand that you operate on behalf of specific schools. The question I’m asking is for those schools to get paid, the consumers have to get the approval from their central bank to transmit foreign exchange for that scale. The question I’m asking is very specific. Are you facilitating that process of approval as well? Does that mean that you’re also integrating with those central banks systems?

Mike Massaro: It’s country-specific. I’ll give you two examples. In a place like India which is a heavily regulated environment, what we do is we partner with leading banks or license providers to perform that function in India. For an outside company to get that license will take many years. In the case of India, we partner with ICICI Bank. We do all that file keeping inside India. They collect the INR. They will convert the INR and deliver it to us in US dollars.

In another example, in Europe we have a licensed entity under the Payments Services Directive in UK. That money is actually going directly from the consumer into a Flywire-owned account. We have to have a model that supports both where we own it end-to-end. If we’re not the regulating entity, we look to existing financial institutions to be our partners.

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