THERE are numerous inefficiencies in the global micropayment systems and Tranglo Sdn Bhd, a digital hub for cross-border financial transfers, aims to make improvements where it can.

Blockchain payments and electronic know your customer (e-KYC) services are part of Tranglo’s expansion plans, says founder and director Sia Hui Yong, who is a nominee for the technology entrepreneur category.

“By implementing these technologies, we hope to change the cross-border landscape [and] enable the end user to make more efficient transfers,” he says.

Tranglo has said that it aims to increase its processing of cross-border transactions by US$3 billion by 2020. The company expects to have processed about RM600 million worth of transactions by the end of 2016.

“The expansion route that we’re going for [involves] a lot of digital-based remittances,” Sia says.

“Essentially, today we are very much business to business (B2B), [but] we are launching additional business-to-consumer (B2C) channels,” he adds.

Tranglo currently derives 60% to 70% of its revenue from the Malaysian market, but hopes to diversify its income stream in the coming year. Sia targets to increase revenue flow from its international operations to between 60% and 70% next year.

The company traces its roots back to 2008, when Sia became intrigued by his friends’ requests for large quantities of Indonesian mobile phone top-up vouchers. “Why would you want an Indonesian top-up card in Malaysia? It didn’t make sense for anyone to use roaming [back then].”He then discovered that migrants were buying the vouchers as gifts, sending the airtime value back to their loved ones.

He recognised the inefficiency of travelling to Indonesia to buy the physical cards and that there was a need for a more seamless approach to airtime transfers.

Thus, Sia founded Tranglo to connect operators from different countries and act as a transaction hub for processing payments, foreign exchange, billing and reconsolidation.

The telecommunications executive had founded Ionnex Sdn Bhd in 2002, one of the first companies to set up an end-to-end ecosystem for mobile content management, distribution and billing to help content providers monetise their offerings on the mobile space, according to its website.

“I created a spin-off because I understood that if this thing worked, the capital structure and funding would be very different,” he says of Tranglo.

Having developed a platform in the industry, Sia had an edge in terms of connections with regional telecommunications companies. Tranglo is now connected to 100 operators directly and 200 indirectly, across 110 countries.

Going forward, migrant workers will remain one of Tranglo’s core segments but it wants to capture cross-border verticals such as healthcare, education and investment payments.

“When you make payments across borders, you have to go through the same processes: bank telegraphic transfer (TT) and SWIFT charges … maybe clearing two days later.

“When we’re pioneering all this technology, [we want to be] faster, cheaper and more secure,” Sia says.

When that happens, he says, not only will the migrant workers continue to benefit from Tranglo’s products but also others such as those who want to engage with healthcare service providers and services overseas.

Among the pressures Tranglo faces is adapting to different regulatory frameworks across borders.

Although processes for due diligence and anti-money laundering are of roughly the same standard across most countries, Sia points out there are finer complications that need to be ironed out. For example, banks in the UK and Europe may have e-KYC facilities but local banks may be less prepared to adopt identification technologies such as face-matching, he explains.

Tranglo also encounters stiff competition from a variety of companies but Sia is quick to point out that the company is one of the few service providers in the world that integrate airtime-sharing services and money transfers.

Its closest competitor in that respect is TransferTo of Singapore, a B2B mobile payment network that also enables the real-time transfer of money via mobile phones and airtime sharing. TransferTo processed more than 50 million transactions in 2015, according to its website.

Meanwhile, Sedania Innovator Bhd has been actively promoting its airtime sharing (ATS) platform. The company, which was listed on the ACE Market in July 2015, announced its partnership with U Mobile earlier this year to provide the ATS service to prepaid customers. 

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