TransferWise: a startup that facilitates international transfers

If you have an account abroad and need to transfer money there, you already know what the bank fees are for completing the process. Estonians Kristo Käärmann and Taavet Hinrikus saw a great business opportunity in this and founded the in London in 2011 beginning TransferWise.

According to the company’s website Storytellers can save 90% of traditional prices when sending money abroad. A simulation on the site’s homepage showed that transferring £1,000 via the platform brought in €1,351.87, roughly converted to the official exchange rate, and saved an average of €60.53 in bank charges.

TransferWise Worth $1 billion

The two makers of TransferWise (who are among the first employees of Skype) came up with the idea when, already living in London, they transferred money to their accounts in Estonia and realized that the operation was very expensive. That beginning therefore arises to facilitate transactions from pounds to euros – in the same way as Skype was created to facilitate contact between two people living in distant countries.

The great idea guaranteed TransferWise first place in a list compiled by the website Business Insider with the fifteen beginning most innovative European from the finance sector. Success became numbers. According to the newspaper, the company received a $58 million financial grant from American fund Andreessen Horowitz, which increased its market value to $1 billion financial times.

According to the website of beginningthe service currently provides 292 transfer routes and is to be expanded to 300. The customers of the service are distributed all over the country 50 countries of the world.

How does it work TransferWise

How does Käärmann and Hinrikus’ idea work? It’s a very simple algorithm that connects people who want to transfer money to another country. If a person lives in England and wants to send money to Spain, for example, they deposit it in the UK account of TransferWise.

The algorithm then finds someone else who wants to do the opposite and deposits money into the company’s Spanish account. This way, only the cost of transferring between local accounts and a minimum transfer rate are paid. beginning.

The platform has all the licenses required by the UK, issued by the Financial Regulator (FCA), a UK financial authority that recognises TransferWise as a legitimate payment institution.

payment trends on-line

In the technological universe, many beginning They are successful because they focus on the concept of solving a problem or facilitating an action. TransferWise It’s not the only idea aimed at reducing the population’s dependence on the harsh — and sometimes abusive — global financial system.

As current examples we have Bitcoin, totally virtual and free encrypted currency of a central financial authority that regulates operations; Already PayPalintermediary of payments via Internet.