You don’t need to be a financial guru to know that banks don’t offer the best exchange rates when it comes to international money transfers. But, you know, it’s a hassle to explore alternatives for those ad-hoc payments – and how much could you really be losing? Rather a lot, as it turns out (cheeky banks). Say hello to TransferWise, Europe’s leading fintech company, which launched in Singapore last month and is driving down the cost of sending money abroad with its simple-to-use service.
Co-founded by Taavet Hinrikus and Kristo Käärmann in 2010 and naming Sir Richard Branson among its many high-profile investors, the remittance company was created out of frustration with the high fees charged by banks on international money transfers. Taavet (who also happens to have been the first employee at Skype) needed GBP, Kristo wanted EUR – and so the duo bypassed the bank’s mark-up rate and fees and figured out a fair deal using the mid-market exchange rate. They each saved a big whack in the process, and so began their business model, which is now being used by upward of one million customers to transfer over $1.75 billion every month across 40 currencies!
“TransferWise is about creating a financial services sector that is focused on what’s best for the customer, rather than what’s best for the banks,” says CEO Taavet. “People in Singapore finally have an alternative to the banks!”
We chatted to Taavet about the key benefits of sending money abroad using the real exchange rate. Take heed before you press send on your next international money transfer using your current provider!
1. It’s cheaper
The real exchange rate (aka the mid-market rate) is our friend. This is what TransferWise uses without any hidden mark-up fees, making the service five to seven times cheaper than banks to send $1,000 abroad and three times cheaper to send $5,000. And there’s no minimum transaction, which is handy.
2. It’s faster
On routes from Singapore, the service is typically one to three days faster than banks and other remittance companies. While banks usually take between one to four days, TransferWise can be exchanged into GBP, EUR or AUD within 12 hours and USD within the day. Considering that you can use the service to send from 37 countries and to 59 countries, we reckon that’s pretty impressive.
3. It’s fairer
Watch out! Banks could charge you up to 5% in hidden costs when sending money to any bank account abroad. TransferWise, meanwhile, charges between 0.5% to 1% of the amount you’re sending. All this amounts to a fairer financial system and more currency on the other side. Your shout!
4. It’s quick and easy to sign up
To sign up for an account and set up a transfer, head over to TransferWise.com and submit a ‘selfie’ with your ID document for once-off online verification. No need to trek to an office across town for face-to-face verification – TransferWise is one of the first remittance companies in Singapore to be allowed to issue online approvals.
That done, simply tap in how much and where to and make a local transfer from your bank account to TransferWise’s DBS account in Singapore. Your money will be converted at the mid-market rate and paid to the recipient. Capisce?
Brought to by TransferWise | transferwise.com