TransferWise was launched in 2011 and is among the largest and most reputable online international money transfer providers. Over the many years of using the platform to send and receive money, my experience has been nothing short of excellent — but my needs have since changed and Currencies Direct is my go-to option.
In today’s ultra-competitive fintech universe, TransferWise managed to thrive nearly a full decade because they got the basics right: competitive pricing, timely service, and most importantly, a reputation of never letting me down.
I’m far from alone. The company has more than 4 million customers who combine to transfer billions of pounds across more than 750 currency pairs each month.
A True Revolutionary In Pricing
A foreign exchange transaction at a traditional bank has two main components in determining what the client will ultimately pay. First is the fee the bank charges for their services, and second is the exchange rate. In many cases, the exchange rate offered is inflated but this isn’t due to a mistake or an inefficiency in the foreign exchange market.
Rather, banks add on a second hidden fee which they may label as a “foreign exchange commission” on top of their standard advertised fee. This is one of the many reasons why banks are able to profit billions of pounds a quarter and still pay eight-digit salaries for high ranking executives.
This is where Transferwise enters the equation. What if instead of banks hiding their fees, a money transfer service can let their clients know exactly how much a transaction will cost.
But Transferwise wasn’t satisfied with just being transparent about how much a transaction costs. Instead, they broke down where the fees will be allocated. As an example, a customer who wires 1,000 USD to EUR will pay a fee of $6.95. Of that amount, $2.17 will go towards marketing and business expenses, $1.78 covers infrastructure and managing payments, $1.16 goes towards research and product development, 94 cents towards customer support and securing customer data, 60 cents goes towards its people and offices, and 31 cents is paid to partners and suppliers.
Transferwise is among the few companies in the world that truly respects the fact that they are taking your money so you should know what’s happening with it. While some banks openly acknowledge overcharging customers yet nothing changes at the end of the day. The fact that the global banking elite in London, New York, Tokyo, and elsewhere feel the need to ignore this concept is mind-boggling.
No One Can Be Everything To Everyone
TransferWise was founded in 2011 by two ex-pat Estonians living in London who realized they share a common problem without knowing about it. One of the co-founders Kristo Kaarmann earned pounds at his work but needed to transfer money to euros to pay for a mortgage in Estonia. At the same time, co-founder Taavet Hinrikus was working for Skype in London so he was paid in Euros but needed pounds to pay the bills.
Both individuals had to send money in the opposite direction and had no choice but to accept bank fees. Their business model was created after figuring out a way to swap currencies between each other using a mid-market rate.
It’s clear their business caters to individuals who need to transfer money and save as much as possible. Not too long ago, this was all I needed, but that time has unfortunately passed.
Sorry TransferWise, Currencies Direct Won Me Over
By every measure, TransferWise is a great service that offers among the most attractive fees in the industry — if not the best. For anyone whose sole consideration is fees, TransferWise may be the best option.
But for me, my complex finances and busy lifestyle means I can accept paying a little bit more in fees for some added benefits. Currencies Direct offers a personal account manager to help each client make the most out of every transaction. The company is also able to offer access to specialized experts in different markets, including key regions like the USA, U.K., Spain, France, and others.
As such, they have the resources to give me that extra personalized service I have come to realize over time I need. This obviously isn’t free but in all honesty, the costs are reasonable because it saves me time so I can better focus on my business.
Conclusion: I Made The Right Decision
I hesitated to switch platforms at first but I knew it had to be done. I’m no longer a student on a very strict budget where cost is everything. But what I wasn’t ready to sacrifice on was speed and ease of service.
Much like TransferWise, Currencies Direct allows me to send and receive transfers 24 hours a day, seven days a week. The vast majority of transfers between the world’s largest currencies were finalized within one working day and many were closed on the same day.