UK-based TransferWise started as an online money transfer service, letting people transfer money between countries at a cheaper rate than with a bank. Europeans may be familiar with the brand, but in Asia, Singapore is Transferwise’s first stop, and their mission is to help travellers cut down on hidden costs pegged to international transactions.
TransferWise Debit Mastercard is similar to a multi-currency account, where users can hold over 40 different currencies, and exchange currencies in the comfort of their own phone. Accepted by merchants in over 150 countries, the card’s currency conversion is done using the real mid-market exchange rate such as the ones found on Google, thus saving customers from paying hidden mark-ups to the bank. Accordingly to Transferwise, the card works up to be six times cheaper than the market average, saving travellers plenty.
No more queuing at the money-changer or carrying large amounts of cash before travelling overseas – all users need to do is to preload the card, convert at their convenience, and voila! Instant currencies. Users can also transfer funds, exchange and track your spending all on a single app. There are no card charges for withdrawing up to S$350 every 30 days at ATMs overseas where Mastercard is accepted.
If you have multiple currencies in the account, the system will automatically choose the currency with the lowest conversion fee. With the app installed on the phone, users can freeze or unfreeze the card and change spending limits instantly. Also, purchases are tracked in real time.
Too much hullabaloo? Here’s a real-life example. Say you have SGD 100, RM 100, 100USD and 1000 Baht in the account and you’re buying something in Bangkok for 1500baht. While all you need to do is to wave your card, all the magic happens in the backend. 1000 baht will be deducted from the account, and the system will automatically search for the lowest transfer rates out of your remaining currencies. The remaining can be deducted out of your Singapore Dollars or Malaysian Ringgits, depending on the prevailing best rates.
Transferwise strength lies in simplifying a traditionally complicated banking system. It bypasses pricey banking fees by skipping the “middlemen” banks that accompany international transactions. Transaction costs are transparent, accordingly to TransferWise, unlike providers which add a markup to the real exchange rate in addition to their fees. Sign-up is free, but prior personal identity verification is needed to kickstart the account. There’s no sign-up fees, annual fees or dormancy fees.
Accordingly to Mr Venkatesh Saha, Head of APAC and Middle East Expansion, “TransferWise’s mission is money without borders - instant, convenient, transparent and eventually free. Even though our Singapore card is six times cheaper than the market average, we will stay focused on further reducing our conversion rates to as close to zero as possible.”
It seems like disruption to travel finance is coming!