It’s been an eventful week in the world of international money transfer. Whilst Trump launches trade wars with Europe, China, Canada, and Mexico (to name a few), which is guaranteed to lead to tricky exchange rate calculations for many businesses (don’t forget to check the latest rates and save up to 80% on fees using The Money Cloud), there has plenty of activity in the consumer international payments market too.
Here’s how the big stories have broken down in the past week or so.
Fintech breakthrough moment or pyrrhic victory? TransferWise announces partnership with France’s second largest bank
Peer-to-peer money transfer specialists TransferWise have built their reputation – and a billion dollar business – by taking on the big banks at international money transfer, and winning. The company famously undercuts the big banks’ fees and offers fairer exchange rates by using a peer-to-peer matching system to allow customers to “swap” currencies with fellow humans, and has recently introduced borderless multi-country bank accounts to help customers manage their international funds.
This week, however, TransferWise has announced a partnership with major French bank, BPCE. Groupe BPCE will include TransferWise’s service within their banking app which is scheduled to launch next year. The French bank has 15m retail customers, so the deal certainly makes sense for both parties – Groupe BCPE will be able to offer “bank-beating” money transfer deals, and TransferWise will be able to widen and diversify its user base. But will the company’s reputations suffer somewhat by partnering with a supposed rival?
Kristo Käärmann, co-founder and chief executive of TransferWise said in a statement that “TransferWise has a mission to make money move around the world as fast and as cheaply as email. This partnership is a momentous step on that journey.”
TransferWise already moves more than $2.3bn of transactions per month for it’s 300m+ users. It looks like the one time disruptive startup has joined the big leagues; customers will hope TransferWise does not start charging big-league fees.
New P2P Money Transfer Service For China Announces Launches at Money 20/20
Sending money to China can be a fraught process unless you have experience of international money transfer or are using a dedicated broker, so many might welcome the news that a new service has launched that will permit customers to send money to 90% of Chinese bank accounts, either by debit or credit, in domestic currency.
The company’s name is GeoSwift, and the new service will be known as GeoRemit. Raymond Qu, Founder and CEO of GeoSwift, commented that; “GeoRemit is designed to speed up, streamline and simplify the money transfer remittance process within an ever-changing landscape where transaction values are getting smaller and transaction volumes are increasing.”
It is certainly true that volumes of small remittances and overseas transfers are on the rise. This is in part due to the fact that remittance technology has become more sophisticated, and has transferred seamlessly to mobile devices, meaning transfers can be done in a matter of a few swipes. GeoSwift say they plan to use a single API integration to GeoRemit, and that the service has all the legal measures in place, such as anti-money laundering and know your customer, to navigate China’s tricky legal landscape. Good news for anybody regularly sending money to China.
UK Based Broker Currencies Direct Testing Ripple’s xRapid Blockchain Solution
With money transfer companies constantly on the lookout for faster and cheaper solutions, perhaps it isn’t a surprise to hear that Currencies Direct have been testing Ripple’s blockchain solution, known as xRapid.
Currencies Direct has completed a successful transaction using the blockchain or distributed ledger based technology. The transfer took seconds rather than the 1-3 days which is usually standard for an international money transfer. Currencies Direct Chief Product Officer described the xRapid crypto-token, known as XRP as a “game-changer”, that will make payments “near-immediate, and significantly improve service to our customers.”
Currencies Direct are not the only ones trialling California-based Ripple’s breakthrough tech. Amex, Saudi Arabia’s Central Bank, the UAE Exchange, Santander, RakBank, and Cuallix are all also on board, with Santander recently launching OnePay FX, following a $200m investment into Ripple through its venture capital arm. xRapid’s biggest issue is likely centre around whether it can deliver enough scale to support the money transfer industry, which is worth more than $600bn per annum. Time will tell if Ripple is able to usurp SWIFT as the industry standard for sending payments. SWIFT is also working on its own disruptive solution, SWIFT gpi, used by the likes of Singapore-based DBS bank.
World Remit Expands Footprint In Nigeria via partnership with First Bank
Nigeria is one of the most popular destinations for international money transfer made from within Britain, so World Remit, based in London, will be delighted to be expanding its presence in the country through a partnership with First Bank of Nigeria. The deal will allow World Remit users to send money to First Bank accounts direct from their phones, and this extra convenience factor may well inspire more people to start sending their remittances to Nigeria this way.
World Remit say that more than half of their 1m transactions per month transaction volumes go to Africa, with Nigeria their largest and fastest growing market in Africa, and second largest overall. The deal with First Bank will give the company access to 14m new customers.
Did you know? World Remit also became Arsenal Football Club’s first ever official money transfer partner in a recent sponsorship deal.
Global Money Transfer App Revolut To Move Into Russian Market
Revolut became a money transfer “Unicorn” earlier this year, having raised a fresh funding round that brought the company’s overall valuation to more than £1 billion. There seems to no checking its progress, as Revolut announced this week that it is set to partner with QIWI bank in Russia to offer money transfer services in the country.
QIWI has granted Revolut access to its payments infrastructure via its open APIs, allowing Revolut to offer its full range of fintech services, amongst them money transfer solutions for more than 130 countries, offering the interbank rate.
Bogdan Uzbekov, Head of Revolut’s Russian operations, commented that “Russia is an attractive market for Revolut. We see that there are many users who suffer from expensive and inconvenient financial services, especially currency exchange and outbound money transfers. We are confident that we will surpass the one million users mark in the first two years of operations.”
It is encouraging to see money transfer services, many of them based in London, that are capable of developing technology and relationships that allow them to enter any market, including hard to crack regions like Russia, China, and Africa.
These are our top 5 stories this week, if you would like to submit your news email us or tweet us @themoneycloud, or leave a comment below. Have a great rest of the week!
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