For many expats sending money home or receiving money abroad is more of an adventure than a simple task. If you choose to use a bank there are still many costs involved and traditional transfer schemes such as Western Union are only offer money for value for very large sums.
Other alternative schemes are cropping up and taking the place of costly banks. Despite SEPA, most European banks still charge a hefty fee for money transfer within the continent if they are not made in Euros. For example a transfer from a French bank to a British one will incur costs on both the sender and the receiver: the sender will have to pay to transfer the money in British pounds (or transfer for free in euros and pass the charge on to the receiver) and the recipient incurs costs simply for receiving an international transfer. Natwest charges its customers seven pounds for each £100 or over transfer.
According to the Telegraph , the new way to send money abroad is via a currency broker. Reserved to business users and large sums in the past, these brokers are now allowing very inexpensive same day international transfers for smaller amounts. For example, MoneyCorp charges £5 to send £1,000 to Europe in the same day and Smart Currency Exchange charges a £5 flat fee for transfer under £3000 and does not charge for larger amounts.
Currency brokers are not the only ones entering the small-amount market. Paypal is no longer alone in the realm of online, alternative money transfers. A sometimes costly service (the cost of the transfer depends on the amount) and a consuming sign-up experience (both sender and receiver need a Paypal account) have led to the creation of similar but less costly online transfer services. The Currency Cloud is but one example of these new online transfer providers. It offers money transfer – and other payment services – in 140 currencies and 200 countries. It is cheaper than banks, traditional money transfer providers and currency brokers. Its potential hasn’t gone unnoticed and the company was namedon of the Top 25 Global Financial Technology Start-Ups at SIBOS 2012.
