The global remittance market is valued at almost $700 billion. Importantly, it is constantly growing due to our interdependent economies. Australian banks are losing their grip on the market and are now left with a very small market share. Instead, independent remittance providers are overtaking them although the line is becoming blurred with challenger banks and remittance fintech startups becoming one of the same. 

TransferWise has taken the remittance market by storm since its launch of the borderless debit card in the UK during 2018. Since then, the company claims that over $10 billion has been deposited in accounts, and over 15 million transactions have occurred.

A year later in 2019, Australia joined the party as they now have access to the TransferWise platinum debit Mastercard. The debit card allows customers to spend money in over 40 currencies with, usually, the most competitive rate you will find in the market.

Kristo Käärmann, CEO and co-founder of TransferWise, says they decided to launch the debit card in Australia because of how quickly the business has grown there so far. Käärmann stated “In addition to responding to customer demand, launching the card in Australia and New Zealand was also driven by the fact that Aussies and Kiwis are being overcharged by banks for using their own money abroad. It is expensive to use debit, travel and credit cards for spending or withdrawals.”

TransferWise rates are simply superior to anything that Aussies have experienced before. Being a country that enjoys travelling abroad, limited in weather diversity regarding fresh produce and their reliance on imports in many industries, Australia are constantly purchasing things in foreign currency. As Käärmann summed up, they’re losing so much money from currency margins and fees. 

Australia was a very obvious choice for TransferWise too because it is British. Australia and Britain have a special relationship, whereby the rest of Europe is usually ignored by Australia in preference for the UK. The economic and political ties have made it easy to locate a business in Australia – not to mention the appetite for startups with the entire economy being driven by SMEs and startups.

Expats in Australia

TransferWise’s decision wasn’t just for Australian’s, though. Considering almost 30% of the population was born overseas and the government usually has around 200,000 migration places each year, Australia is becoming a hub of diversity. Moving there can be a pain though; it’s far away, they have strict guidelines and the prices are likely higher than in your resident country. 

TransferWise has become a popular way to ease this transition by offering a borderless experience. It’s far more likely than not that the expat has moved from a country with a currency that is offered by TransferWise. For those exchanging their life savings, or even receiving their income or pension in their previous currency, TransferWise has helped people save thousands of AUD each year. 

How does TransferWise compare to its competitors

TransferWise Australia has soon become more successful than long-established remittance companies such as World First and OFX.

TransferWise vs OFX

OFX is one of the largest foreign exchange companies in the world. They served as a fantastic alternative to bank transfers as they offered decent exchange rates, and therefore saved a lot of Australians a lot of money. 

However, OFX has an exchange rate markup as well as a fee. Whilst the fee is low and the markup is not too offensive, TransferWise simply outperforms OFX. TransferWise has a low fee of 0.5% but importantly, they do not have a markup in the slightest. They claim to provide you with the “real” mid-market rate with zero margins.

TransferWise vs World First

Again, both are great options are preferable to banks. World First is perhaps better for large transfers as their fees are a flat fee of $10, but is free for transfers over $10,000. This is, of course, cheaper than paying 0.5%. However, it is worth considering that there is a 0.2% margin on the exchange, whereas TransferWise offer the real rate. Because of this, it’s certainly worth using TransferWise on small transfers to avoid the $10 fee + 0.2% markup. And this is their target market – normal people with day-to-day expenses or a week holiday’s worth of vacation spending money.

Transferwise reviews are a testament to their success. The truly honest and objective way to seek out startups that are offering good value, great customer service and delivering on their promises is by trudging through online reviews. TransferWise generally stands out from the crowd in this respect, so it is obvious in this sense what is driving their sales: their own hard work, innovations and word of mouth (although they do have some great marketing campaigns about). 

The great news for Australians now is that they needn’t put up with inadequate financial services anymore. When you have challenger banks and fintech remittance startups making waves in the markets, the bigger companies either up their game or lose out. Unlike signing up to a bank, you can drop out of your TransferWise usage at the drop of a hat and switch to the next, better thing. That’s the beauty of startups, they take 5 minutes to set up an account and they take 5 minutes to move on once they begin to underdeliver.