Having never had any need to use them, I’ve never really taken too much notice about international money transfer services. However a press release I received about TransferWise piqued my interest, largely down to the service’s origins and rapid growth.
TransferWise allows people to transfer money abroad at a lower cost than they could through banks. It uses technology to remove all the fees the foreign exchange industry has kept hidden for decades.
Since its creation in 2011, customers have already moved more than Â£1bn using the platform – an approach that has saved them over Â£45m.
So how was TransferWise created? Estonian friends Taavet and Kristo came up with the idea for building the platform when they first became expats in London and were confronted by the high fees banks charge to transfer money abroad.
Taavet had worked for Skype in Estonia, so was paid in euros, but lived in London. Kristo worked in London, but had a mortgage in euros back in Estonia.
They realised they each needed the currency the other had, so they devised a simple plan: every month Kristo put pounds in Taavetâ€™s British bank account and Taavet put euros in Kristoâ€™s euro account. They used the official mid-market rate exchange rate (thatâ€™s the one in the papers, not the one invented by the bank). They both received the right amount of money, and neither paid any bank fees.
Within a few months theyâ€™d saved thousands of pounds and realised there were probably millions of others that needed a system just like theirs.
After hitting its Â£1bn milestone and raising $25m from Sir Richard Branson and others this year, TransferWise is now moving beyond the â€˜early adopter phaseâ€™ to challenge the banks for the mainstream customer. As a first step towards this goal, TransferWise relaunches today:
- Web: Website redesign, including a streamlined and more intuitive user experience which â€˜onboardsâ€™ customers twice as fast as before.
- Design: A new visual identity and logo – â€˜The Fast Flagâ€™ – to create a sharp contrast with traditional banks and money transfer brokers.
- Mobile: iOS 8 app for iPhone 6 and 6+ and iPad, featuring total redesign, touch-ID login and deep integration with the iPhone contacts book.
- TV: Its first primetime TV advert to air nationally in the UK from today.
Here’s the advert:
Taavet Hinrikus, co-founder of TransferWise, said:
â€œThe retail banking industry – particularly in the UK – is dominated by a handful of major players. This poses a huge challenge for fintech companies like us, looking to attract consumers whoâ€™ve grown up with the same few brand names.
We believe that just being a little better isnâ€™t enough, so we strive to offer something thatâ€™s ten times easier, faster and better than the banks to make mainstream consumers aware of alternative finance providers like us.
Thatâ€™s why weâ€™ve invested in the new product, brand and TV ad that weâ€™re launching today.â€
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