For the last couple of years you have probably seen new actors entering the money transfer services market. Until then you may not have questioned yourself too much regarding the solution you were using to send money abroad and used your bank. However the market is changing and it is changing quickly for the better as these new actors are helping reducing the costs of transferring money internationally.
What are the main money transfer services?
Money transfer services are services that allow you to send money in a foreign country. The most famous ones are probably the banks and Western Union. They have been dominating the market for the last decades or even the last century. But recently, things have changed a little bit: new actors arrived on the market with much lower prices such as Transferwise or WorldRemit. They operate 100% online and offer a very good service for 2 to 4% of the amount sent (nothing compared to the nearly 10% of banks!). According to the World Bank there are today more than 500 money transfer services worldwide that allow you to send money internationally. Very few of them are operating on a global scale (except dinosaurs like Western Union or Moneygram) and those who do are very expensive. Just like airplane companies, you might use a British operator to send money from Australia to New Zealand but the probability that you know about it is quite low unless you have used a comparison platform.
The growing need to compare money transfer services
As we have just said there are more and more operators in the world of international money transfer services today and finding the one that perfectly suit your needs can be tricky. Indeed, one can have many reasons to send money abroad: a retiree who needs to get his pension, a student who needs his parents to send him money, an expat who needs to pay back a loan in her home country, a mexican worker living in the USA and who needs to send money home. Depending on your situation you will not be sending the same amount of money. This directly impacts the money transfer service you’ll be using as some are cheaper for small amounts and other are better at sending large amounts of money (brokers). This explains why there is a growing need to compare the operators, just like we started to compare airplane companies or hotels when planning holidays.
2 things to remember: Banks are expensive when it comes to send money overseas and you need to compare money transfer services before making a transfer to make sure you find the best solution.