For your business to succeed today you must be innovative and progressive. This means stepping away from traditional but inefficient solutions to use their digital alternatives. Switching to online money transfers definitely falls into this category of business development. Money transfer companies are growing fast, especially now when the COVID-19 pandemic limited people’s ability to use “old-school” banking services. But remember that any emerging industry is volatile. Therefore, you need to pick a trustworthy money transfer provider with extreme care.
The Growth of Fintech Today: Pandemic and Its Impact
Fintech software is in high demand today and with good reason. These solutions make a variety of financial services more accessible. This has the power to change the lives of millions and boost developing economies. Right now, when countries are enforcing social distancing and the second wave of lockdowns seems imminent, online banking has become an actual necessity.
The times of crisis push the development of fintech forward even faster. For example, the previous crisis of 2008 made traditional lenders reduce access to loans by making eligibility requirements more stringent. Small businesses and startups were crying out for a solution as they were refused loans. The solution came in the rise of online lending services and crowdfunding platforms.
A similar situation is happening today, but as alternative lending is already there, it’s the obsolete bank wire transfer system that appears to be replaced. Online money transfers are becoming the new normal in the world where cash itself becomes obsolete.
Of course, any decent bank today also offers a method of online banking and money transfer. However, with banks, it’s only the format of these transactions that changed. This means that you are able to do the majority of transfers using a simple mobile app. However, those transfers remain expensive because it’s your bank that charges high fees and sets unfavourable foreign currency exchange (FX) rate margins.
There is a different fast-growing segment of fintech addressing this issue. Specialized money transfer companies, often referred to as FX companies or brokers, are focused on making these services not only accessible through mobile apps but affordable as well.
Leading Online Money Transfer Providers Today
Online money transfer industry is developing rapidly, which means there are many promising companies within it. The biggest among them today is TransferWise, valued at $5 billion according to the latest reports. This company offers some of the cheapest transfers and supports 50+ currencies. It has no minimum transfer limit and basically caters to anyone who wants to make a fast, secure, and cheap international transfer.
But note that TransferWise, for all its benefits is primarily targeted at private clients who need to make small transfers. Businesses are better served by companies like OFX, which is one of the best money transfer services in Australia. Today the company, which was launched in Sydney in 1998, has the widest global reach. More importantly, it offers a corporate service package that can help businesses go global and reduce the risks of doing so.
In particular, OFX offers its customers access to hedging tools. This means that you get a chance to reduce the currency exposure risk that makes going global so dangerous, especially during volatile times.
As a business owner, you should be looking for online money transfer services that work with corporate clients, in particular. They can provide services that will benefit your business in many ways. Most importantly they will help you save money on international transactions.
Other great options for businesses are WorldFirst and Currencies Direct. They are most beneficial for the e-commerce sector. WorldFirst is currently owned by Alibaba Group. Therefore, it offers services tailored to online sellers. These online money transfer companies’ software can easily integrate with online store solutions.
Should Your Business Switch to Online Money Transfers?
The answer to that question is a definite “yes!” Online money transfer companies are as safe as banks today because they use bank-grade encryption and other cybersecurity measures. But they offer services that much exceed bank offerings.
Most importantly, they make those services very affordable. This means that more businesses can now go global. And progressing to the international seller level is essential today when the global economy is in recession.
However, you shouldn’t forget that the online money transfer industry is new. Therefore, it’s poorly-regulated, so you need to be extremely careful with your choices.
You can trust industry leaders and veterans like TransferWise, OFX, Currencies Direct, TorFX, WorldFirst, etc. That’s because they had years to prove their reliability and build a reputation for trustworthiness. They are also certified and audited by reputed financial authorities, including the FCA.
These are the qualities you should be looking for in an online money transfer company. Always check its certifications first. You need to be sure that the cheap transfer offer comes from a legit business instead of some scammers trying to steal from you.
