Citibank has expanded the scope of its P2P payments solution to international transactions.
With increased experience in the peer-to-peer (P2P) ePayments area, Citibank has shifted its strategy for c2it, its P2P payment solution, from targeting generic web users to targeting consumers with specific P2P payment needs. As part of this segmentation exercise, the company is looking to capitalize on the opportunity offered by ethnic markets in the US.
Approximately 10% of US residents were born outside of the US and these ethnic consumers send nearly $15.5 billion to their native countries each year. International transfers cost $30 on average, take almost seven working days to process, do not have guaranteed exchange rates and require the recipient to have a bank account. c2it provides a strong value proposition to this market segment by offering improved international P2P transactions including reduced costs ($15 for direct deposits and $10 for checks), a four-day processing cycle and guaranteed exchange rates.
While other players such as Paypal have developed an international presence in the P2P space, c2it is unique in its targeting of the ethnic segment. By guaranteeing the exchange rate on the day of the transaction, c2it reduces the risks for customers sending money to high volatility markets such as Latin America and Asia.
Further developments, including the ability to have cash hand-delivered directly to the recipient and money sent instantly from savings and checking accounts, will enhance Citibank’s innovative ethnic marketing initiative in the payment arena. c2it’s success in ethnic markets, however, will require development of partnerships with Internet portals that have large ethnic customer bases and delivery of a strong message about the benefits of c2it.
In spite of a current lack of demand for P2P payments, market growth will occur as consumers become more aware of P2P ePayments and as banks target the right customer segments Citibank’s current investment in this space will help establish the global bank as a leader when the market matures and demand increases.
