By Oliver Smith on Tuesday 28 September 2021
Challenger division failed to find its footing in the international payments space.
Santander has pulled the plug on its Wise-rival PagoFX just 15 months after it launched.
Santander described the move as being designed to refocus efforts on business-to-business payments within its PagoNxt division.
“We have ambitious plans to grow PagoNxt and expect to more than double revenues in the media term, with an immediate focus on high growth segments such as merchant and trade services,” a PagoNxt spokesperson said.
“To help support this growth, we have decided to integrate the PagoFX technology into our trade services business to leverage the fast and secure payment capabilities offered by the service.”
PagoFX was launched as an “autonomous fintech startup” with 50 employees and the promise of becoming a real challenger in the low-cost international money transfer space.
However, yesterday Santander wrote to PagoFX customers explaining that the service would shut down on 30 November, with new customer registrations closing today.
The closure comes just a month after Santander declined to provide AltFi with an update on the performance of its PagoFX subsidiary, which wasn’t even mentioned in the group’s latest set of results.
PagoFX’s last update was in December when Santander added the ability for UK SMEs to register and use the service for business payments.
While it’s disappointing to see yet another challenger brand bite the dust—joining the likes of Bó and Esme Loans—Santander’s decision to refocus on what’s working is probably correct.
The international money transfer sector is vast; PagoFX with the Santander brand stood as good a chance as any of becoming a real competitor, stealing market share from the likes of Azimo, Wise and WorldRemit.
However, with just 439 followers on Twitter and 329 ‘Likes’ on Facebook, it’s clear that it never happened, and PagoFX failed to find its footing.
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