Transferwise recently announced that it will be partnering with BPCE in order to provide money remittance services. It will be providing the money remittance services to the customers of the lender. With this announcement, it became the 1st UK Fintech start-up to tie up with a major bank.
Transferwise has its headquarters in United Kingdom. Transferwise provides a low-cost money transfer solutions to its customers. The commission which it charges is much lower. The cost of these money transfers is much lower as compared to the banks. In the world of money transfers, a significant commission is taken by the banks in order to move the money. Moreover, the exchange rates are not in favor of the consumers. As a result, the total commission which is charged is always on the higher side.
Transferwise currently has 3 million customers. It transfers around US$ 2.3 billion each and every month. Also, with the help of this tie-up, it is trying to expand its services to cater to even more customers. Transferwise was founded in 2011. During the initial days itself, it was seen as a threat for the established financial institutions as well as the banks. Due to the low commissions on money transfers, it was able to capture a significant chunk of the market. By March 2017, it was already profitable. As a result, it continued to gain more and more traction in the money transfer business.
BPCE is the 2nd largest bank in France. As a result, Transferwise will be able to get access to 15 million customers of the bank. Moreover, the services of Transferwise will be directly integrated with the application of the bank. As a result, the customers will be able to easily transfer the money.
Transferwise is actually a serious threat to the traditional banks. The traditional banks will become incompetent if they continue to charge the same fees for money remittance. This is the reason why it is been a disruptor.
With the help of this tie-up, the institutes will benefit greatly. Transferwise will be able to expand its customer base quite easily. In total, the bank serves around 15 million customers. As a result, the potential customer base for Transferwise after this tie-up is pretty huge. BPCE on the other hand will be able to offer their customers with low-cost money remittance services. As a result, it is a win-win situation for both of them.
Keyword: Transferwise, UK Fintech start-up, BPCe