How Zolve helps American immigrants land on their feet
Founded by serial entrepreneur Raghundan G (Raghu), the idea behind Zolve was formed over dinner with friends in New York in 2020.
When the check arrived, Raghu realized that none of his guests, all Indian citizens, had US credit cards and had no choice but to pay in cash or with a debit card. .
In India, these people were considered creditworthy, yet in a new country they were a credit risk. The US financial system is not set up to monitor financial data across borders.
This experience inspired Raghu to found Zolve, a cross-border neobank “for the citizen of the world”. Zolve enables equitable access to financial products and understands that people with financial lives in more than one country need access to financial products worldwide.
Immigrants moving to the United States cannot obtain a reasonably high-limit bank account or credit card without waiting months, sometimes years, to establish credit. This means they are often unable to open a bank account or access lines of credit, or have to accept higher fees when borrowing money and pay more for essential services like insurance. , utilities and car loans.
Zolve gives immigrants to the United States access to FDIC-insured bank accounts, credit cards, and high-limit debit cards without the need for a social security number or credit score American.
“When immigrants settle in America, they may be struck by the reality of the cost of the United States relative to their country of origin,” Raghu said. FinTech future.
Rather than waiting months or years to establish a credit score, new immigrants can use Zolve to access U.S. banking services from day one, allowing them to immediately begin building credit “and achieve their goals. long-term finance.
Lack of access to financial services can lead to difficulties when it comes to saving money and finding accommodation. Many new immigrants can’t get affordable housing because they don’t have a credit history or don’t know how to apply for a mortgage. Immigrants with no credit history sometimes get no loans or have to pay a higher interest rate on existing loans.
“Education on investing and asset building, budgeting tools, credit score tracking and the ability to manage personal finances, especially in a new country, is the way to go,” says Raghu.
Zolve acquires customers in India and retains them in the United States, the two countries in which the company currently operates. “In this way, current acquisitions are made through multiple marketing channels, including affiliates, offline and online channels, digital media and content marketing,” says Raghu.
Zolve has partnered with subsidiaries in India which are Education Loan Providers, Education Abroad Advisors, Visa Consultants and Accommodation Providers among others. Another big draw for the Zolve product has been the power of referrals and word of mouth among the student community.
“We have a strong presence at over 380 American universities, and we have a long-term student ambassador program to help grow in the United States.”
For working professionals, the approach is slightly different. Zolve has focused on business combinations where the partnership is mutually beneficial for employees and companies. “As professionals learn about the product, they eagerly refer their colleagues as they discover gaps in the existing system,” says Raghu.
Zolve has also teamed up with partners such as Mastercard, Wise, Trulioo, ZeroHash, and CFSB. “These partnerships have been key in enabling Zolve to make our product user-friendly and practical across all geographies,” says Raghu. Additionally, building partnerships with well-known names in the United States has given the company a “high sense of credibility” in the market.
So why haven’t traditional financial institutions done more to support this cause?
“There could be several reasons why traditional financial institutions might not have responded to this cause,” says Raghu. First, most of them may not have been exposed to the plethora of issues that immigrants face when settling in the country, especially when it comes to financial literacy in a new geography.
Second, even if former FIs are aware of and strive to serve this segment of the population, they may not be able to do so effectively until the immigrant arrives in the country.
“But, in reality, an immigrant thinks about managing his finances long before he moves,” says Raghu.
New problems, new solutions
Certainly, neobanks like Zolve are particularly well placed to tackle this problem.
First, neobanks are built on technology platforms that allow them to offer services at a fraction of the cost of traditional banks.
This means they can pass those savings on to customers in the form of lower fees and better rates.
Since they do not have physical branches, most neobanks only offer their services online or through mobile apps. They can therefore focus on providing good customer service through these channels rather than having to worry about building a physical network first.
Neobanks are also nimble by nature. They don’t have the same legacy systems and processes as traditional banks, so they can more easily adapt their offerings to meet changing customer needs and segments.
They also offer fraud protection, as they use biometrics and artificial intelligence (AI) to identify potential fraudsters before money is lost – “A benefit that can save consumers a lot of time and avoid them having to deal with complaints,” says Raghu.
The benefits to society of being driven by solutions like Zolve are numerous. Zolve helps immigrants accelerate their financial health through products that create long-term wealth, resulting in higher income levels for immigrants, and the propensity to save is much higher.
“Another way Zolve helps the greater good is to facilitate the smooth flow of money across the world,” says Raghu. Raghu cites research that shows immigrants send about $600 billion each year to their families back home. With Zolve, remittances are competitively priced and happen at lightning speed.
“So imagine if they didn’t have to pay those high fees anymore?” This money could be used for other things like higher education or health care or deposits or whatever else they want to invest in,” Raghu explains.
Lack of access to credit products, meanwhile, is not limited to immigrants. Those with lower credit scores, certain professions or new students and young teenagers are also affected. “These groups will greatly benefit from what we are currently building over the next few quarters, which will be a game changer in building credit in a transparent and risk-free way,” Raghu said.
“At Zolve, we are building a global multi-suite product for the ambitious,” says Raghu. Soon, Zolve will serve multiple countries, providing those considering emigrating not only with a functioning bank account and home country credit card, but a myriad of other products on offer. These geographies include Australia, Canada, Germany, India and the United Kingdom.
“Currently, we are building several new era product offerings that enable financial independence for every citizen of the world,” says Raghu.
“With this in mind, our primary focus over the coming quarters is not only to continue to enrich Zolve’s current product line of investments, credit creation, savings and tracking tools, but also to expand the current geographies we serve.”