Launch of TransferWise for Business to make international money transfer up to 7 times cheaper for SMEs

One in 5 UK SMEs making regular overseas payments have no idea how much they’re being charged, says expanding firm 

Today (Thursday, 26 May) sees the launch of TransferWise for Business, a new, low cost way for companies to transfer money internationally.
With no sign-up costs, hidden charges or monthly fees, TransferWise says it uses peer-to-peer technology to make sending money abroad up to seven times cheaper compared to using a business bank account.
The firm claims nearly half (44%) of UK SMEs send or receive international money transfers at least once every six months, yet many don’t know how much they’re being charged for the service.
  • 1 in 5 (19%) of those who transfer money overseas at least every fortnight admit they have no idea how their bank charges them for these transfers
  • 28% of SMEs transferring money abroad think they get a good deal – either getting the transfer for free or being charged a flat fee with a reasonable exchange rate
  • More than half (61%) of SMEs who transfer money internationally only use their business bank account to do so
The reality – expensive bank transfers with hidden fees
Independent price comparison of the top six UK banks for SMEs shows that the most popular banks and transfer providers are offering their SME customers a very poor deal on international money transfers. TransferWise is up to seven times cheaper than the banks.
Because the traditional bank charging structure for international payments – an upfront fee plus a hidden exchange rate mark-up – is so untransparent, many SMEs don’t even know they’ve been charged more than they thought.
Price comparison of sending £2,000 into euros across the top 6 banks for SMEs, April 2016
Name of bank/broker
Reuters exchange rate at time of assessment
Rate quoted by transfer company
Upfront fee for using transfer company
Money to arrive in euros
Exchange rate mark-up in euros
Exchange rate mark-up in £
Upfront fees plus exchange rate mark-up
TransferWise
1.4483
1.4483
£9.95
2,882.19
0.00
£0.00
£9.95
HSBC (Online/phone/branch banking)
1.4473
1.4189
£9.00
2,825.03
56.80

£39.25

£48.25

Natwest (Online/phone banking)
1.4589
1.4251
£12.00
2,833.10
67.60
£46.34
£58.34
Natwest (Branch banking)
1.4589
1.4251
£22.00
2,818.85
67.60
£46.34
£68.34
RBS (Online/phone/branch banking)
1.4483
1.4122
£12.00
2,807.45
72.20
£49.85
£61.85
Lloyds (Online/phone banking)
1.4483
1.4136
£15.00
2,806.00
69.40
£47.92
£62.92
Lloyds (Branch banking)
1.4483
1.4136
£21.00
2,797.51
69.40
£47.92
£68.92
Barclays (Online/phone banking)
1.4569
1.4278
£25.00
2,819.91
58.20
£39.95
£64.95
Barclays (Branch banking)
1.4569
1.4278
£25.00
2,819.91
58.20
£39.95
£64.95
Santander (Online/phone banking)
1.4483
1.396
£25.00
2,757.10
104.60
£72.22
£97.22
Bank average
1.45246
1.41779
£18.44
2,809.43
69.33
£47.75
£66.19

 

Nilan Peiris, VP Growth at TransferWise, said: “SMEs make-up 99% of all UK businesses – they’re the engine of the UK economy. Despite the banks saying that they support these companies and their growth, the reality is that behind the scenes they’re happy to give SMEs a poor deal with hidden exchange rate charges. In fact, Lloyds Bank recently admitted adding undisclosed charges to overseas transfers made by its ‘less sophisticated’ SME clients. That just isn’t fair and we wanted to do something about it.
“We’ve listened to what businesses want, and created a tailored, easy-to-use product for businesses with fast registration, easy reporting and dedicated business customer support teams. We’re excited to be able to offer SMEs a fairer, cheaper, faster alternative for international money transfer.”
TransferWise says despite poor knowledge of bank charging structures SMEs still send money abroad in large amounts. 1 in 10 UK SMEs who send money overseas transfer £1 million or more across the course of a year.
The launch of TransferWise for Business is the latest development at the fast growing company. TransferWise recently launched routes to China, South Korea and Mexico.
TransferWise says over £500 million is transferred across the globe every month using its platform, saving customers more than £22 million monthly.

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