The 2016 Global FinTech Report released by PricewaterhouseCoopers suggests that around 90% of all banks are worried that they will suffer in realms such as consumer banking, fund transfers and payments. Close to 550 respondents from 46 countries took part in the survey that was mainly designed to determine the role and implications of the emergence of FinTech across banking, asset/wealth management and insurance sectors.
The same report also suggests that over 80% of banks are already taking measures to get back into the game. Financial institutions that do not manage to adapt to the growing FinTech environment will lose out further. End users, after all, are increasingly seeking omnichannel experiences, which different digital wallets have managed to provide successfully. When making cross-border fund transfers, FinTech brings with it safety, speed and cost-effectiveness.
FinTech Money Transfer Companies
Western Union, one of the pioneers of this field, has come a long way since it started offering wire services in the 1870s. Now, the company has turned to technology and gives its customers easy means to transfer funds online. Recipients may receive funds directly into their bank accounts or they can collect money from cash pick up centres. There are other companies that operate cash pick up centres or have tie-ups with agents, examples of which include Azimo, WorldRemit, MoneyGram and Ria.
The recently launched Borderless Account by UK-based TransferWise lets you hold funds in up to 27 currencies, and it also comes with receiving accounts in three currencies. The company has targeted this service toward businesses, online sellers and freelancers. Using existing technology differently, US-based Stripe gives its business clients the ability to receive online payments without the need of merchant accounts.
According to a World Bank report, the number of people with access to bank accounts globally, either through a traditional banking institution or a mobile phone, has increased by around 700 million from 2011 to 2014. When making overseas fund transfers, this gives people easy means to move toward digital platforms. Data taken from Ofcom shows that over 75% of UK’s population uses smartphones. It comes as no surprise, then, that an increasing number of people are using their mobile devices to transfer funds internationally.
Fund Transfers Through Second Generation Mobile Phones
There are several countries in Asia, Africa and South America where the use of second generation mobile phones remains all too common. It may serve FinTech fund transfer companies well to explore this aspect, given the potentially large market. Jamaica-based Digicel Group, a mobile phone network provider with a presence in over 30 countries, has already entered mobile banking and micro insurance. Irish businessman Denis O’Brien, the company’s founder, has also expressed interest in giving his 14 million strong customer base the ability to make and receive cross-border payments.
Do Crypto Currency Transfers Have a Future?
People have started using bitcoin to transfer funds between countries seamlessly. All a user needs to do is download a bitcoin wallet, which is then used to send and receive payments. You may purchase bitcoin from a range of sources and pay for your purchase in different ways. The main reason this medium of fund transfers is here to stay is the elimination of middlemen, although volatility in exchange rates might serve as a deterrent for some.
Conclusion
This sector has witnessed a sea of change in the last two decades because of advances brought about by different FinTech companies. While the older players are trying their best to keep up with changing times, a number of new overseas fund transfer companies have managed to make successful inroads into the market by embracing technology. The future for consumers, without doubt, is bright.