In 2026, remittances to low- and middle-income countries are projected to exceed USD 700–800 billion annually. Cross-border money movement continues to expand, driven by migration, income disparities, and the digitisation of payments.
Yet despite this sustained growth, many Money Transfer Operators (MTOs) struggle to achieve sustainable profitability.
The issue is not customer demand.
The issue is infrastructure, regulatory burden, and time-to-market.
This reality leads to one of the most important strategic questions every remittance founder, COO, or strategy leader must answer early:
Should we launch using Remittance as a Service (RaaS), or should we apply for our own money transfer licence from day one?
This guide provides a practical, experience-based comparison of RaaS versus owning a licence — grounded not in theory, but in how regulators, banks, and real operators behave in practice.
Remittance as a Service (RaaS) is an operating model in which an MTO runs its business under the regulatory licences, compliance framework, and banking relationships of an authorised provider.
Instead of applying for licences and building compliance internally, the operator leverages:
The operator focuses on distribution, pricing, customer acquisition, and growth, while the RaaS provider manages the regulatory backbone.
In effect, RaaS separates commercial execution from regulatory execution.
Owning your own licence means being directly regulated by authorities such as:
This brings full responsibility for:
Owning a licence provides maximum control, but it also introduces maximum operational exposure.
Many first-time founders assume:
In reality:
The choice is not about credibility — it is about timing and operational maturity.
| Dimension | RaaS | Own Licence |
|---|---|---|
| Regulatory responsibility | Managed by provider | Fully yours |
| Compliance team | Provided | You hire & manage |
| Time to market | Weeks | 6–24 months |
| Upfront costs | Lower | High (legal, audits, capital) |
| Banking access | Pre-established | Difficult without track record |
| Regulatory risk | Shared / reduced | Fully yours |
| Operational flexibility | Moderate | High |
| Scalability | High (early stage) | High (mature stage) |
In remittances, time-to-market is a competitive advantage.
RaaS enables operators to:
By contrast, applying for licences first often means:
Compliance costs do not scale down for early-stage operators.
AML officers, audits, transaction monitoring tools, reporting systems, and consultants cost money regardless of volume.
With RaaS:
For many startups, this is the difference between survival and shutdown.
Contrary to common belief, banks often prefer:
RaaS providers already meet these criteria.
Newly licensed MTOs frequently struggle to open accounts because:
Operating under RaaS gives founders exposure to:
These insights are difficult to simulate on paper — and invaluable before building your own licensed operation.
RaaS is not designed to replace licensing forever.
Operators typically consider licensing when:
At this stage, licensing is a strategic upgrade, not a startup gamble.
Global regulators, guided by FATF recommendations, focus on:
They do not prohibit RaaS models.
In fact, regulators often favour:
This makes RaaS particularly suitable for early-stage and cross-border expansion strategies.
Typical licensing-related costs include:
Many MTOs underestimate these expenses while overestimating early volumes — a mismatch that leads to operational stress.
Experienced operators treat RaaS as:
Once validated, they transition selectively to licensing — often corridor by corridor, not all at once.
The most resilient MTOs in 2026:
This phased approach reduces risk, preserves capital, and aligns compliance maturity with business reality.
If you’re looking to start or scale a money transfer business without absorbing regulatory and compliance burden upfront, platforms like RemitSo support RaaS-based launches today — and structured transitions to your own licence when the time is right.
Yes. Remittance as a Service (RaaS) operates under licensed entities and compliant AML frameworks aligned with FATF guidance.
Yes. Many operators use RaaS as an initial launch phase before transitioning to their own money transmitter licence.
Banks prioritise strong risk controls, governance, and compliance quality — not licence ownership alone.
RaaS is cost-efficient during early stages. Independent licensing becomes economical only once volumes scale significantly.
No. Most RaaS platforms support full branding and allow operators to retain ownership of customer relationships.
Typically within a few weeks, depending on selected corridors, KYC configuration, and banking readiness.
Yes. RaaS simplifies entry into new corridors without requiring repeated licensing in each jurisdiction.
When transaction volumes, compliance maturity, and banking confidence are firmly established.
