Did you ever had to transfer money from a bank account in one country to a bank account in another country? Ever had to use a friend or an escrow as an intermediary to save on bank fees?
Did you stay speechless when you completed the transfer and saw the exchange rate of your bank?
Its really a problem to find a friend who’s got bank accounts in those countries or a trusted escrow. Well, one startup is now offering to be your friend who’s got bank accounts in (almost) every countries.
Meet TransferWise, a UK company launched in January 2011 by Kristo Käärmann and Taavet Hinrikus (first Skype employee) and which has already processed more than 10 million euros in bank transfers (read the full story on Wikipedia).
So how does TransferWise work?
First of all this only works when
- Sending money from your own bank account or card – the name on the bank account or card that you pay from has to match your name on TransferWise.
- Sending your money – to pay for your transfer, you have to either make a local bank transfer to TransferWise or manually enter your card or bank account details in their system.
- Account is verified – as a financial institution, they need to know who’s making transfers with them. At some stage, sooner or later, your identity has to be verified. (e.g. To send more than €1,000 in a single transfer, you’ll need to confirm your identity)
- Use correct details in your profile – when you set up your profile, please use your real, full name (no nicknames or initials), real address, real phone number and an email through which they can easily reach you.
- No cash or cheque – as this is a fully online business, they can’t accept or send out cash or cheques. You can use TransferWise to send money from a bank account to a bank account.
TransferWise charges €1 or 0.5% (whichever is larger) which is incredibly lower than what your bank will charge.
But most importantly, TransferWise gives you an accurate exchange rate at the time of the transfer, instead of the usual “non fair” exchange rate most banks use. Exchange rate is usual crutial for making sure you get the most out of your money.
See bellow the concept of TransferWise explained.
TransferWise is a great solution for freelancers and people who work with international clients, nomads who need to move money between countries or simply expats living or studying abroad. Now there is even a TransferWise for business.