Remitly killed Passbook, its immigrant banking neobank, after three years

On 2023-02-27 Banking Dive reported that Remitly was closing Passbook, the immigrant-focused digital banking platform it launched in 2020. CEO and co-founder Matt Oppenheimer announced the decision on the fintech's fourth-quarter earnings call, citing the mission to narrow focus on core customers: no new Passbook accounts were being accepted, and service would stop on May 1.

The problem was fit, not traction: Passbook 'was gaining traction with customers', Oppenheimer said, but sat outside Remitly's core segment. 'The product wasn't going to achieve the scale necessary fast enough to contribute to meaningful returns because it was just a different segment from Remitly customers,' he told analysts. 'We didn't get that synergy.' Remitly, which had partnered with Sunrise Banks to offer the accounts, declined to say how many Passbook had accrued in three years.

Remitly redeployed the resources to its core money-transfer network, announcing the same week that it had launched outbound remittances in the UAE — its 30th send country, in a nation where immigrants comprise nearly 90% of the population — extending a network of more than 4,300 corridors.

Three years of building a neobank with Sunrise Banks shut down; resources redeployed to the core remittance business

The neobank served a different segment from the remittance customers Remitly knew how to acquire

Scale was coming too slowly for the product to return meaningful capital

The same engineering and marketing resources had higher-return uses in the core transfer network

A brand-adjacent product for a different customer is a second startup — synergy has to be proven, not assumed from a shared audience

As of 2023-02-27 Passbook was closed to new accounts and set to end service on May 1, with Remitly folding its learnings into remittance features while expanding its global network.