LONDON, October 4, 2015 /PRNewswire/ --
TransferWise figures show eight million UK consumers
affected
Hidden charges on international money transfers are costing UK
consumers £2.88 billion every year, and affecting eight
million people.*
The scale of hidden charges on international money transfer is
more than twice as much as Card Protection Plan (CPP) mis-selling
which cost consumers £1.3 billion, and hit seven million
people. The Financial Conduct Authority (FCA) ordered banks and CPP
to pay £1.3bn in compensation. Despite the scale of hidden overseas
money transfer charges being greater, the Government has yet to
take action.
The research comes from TransferWise, the peer-to-peer
international money transfer platform. TransferWise is calling for
an end to the hidden costs banks and money transfer companies place
on pricing in international transfers and travel money. It asks the
Government to commit to its pre-election pledge to bring greater
transparency to charges and fees applied to foreign exchange
transactions.
Taavet Hinrikus, CEO and co-founder, TransferWise
said:
"Banking has been unfair for decades. With a monopoly on
financial services, high street banks have been able to
overcharge and under-serve consumers. To make it worse, there's a
complete lack of transparency in the sector. Consumers are often
completely unaware of what the banks are charging them.
"That needs to change. This affects millions of people in the UK
every year - everyone from students studying abroad to pensioners
who have retired overseas. Consumers have the right to know what
they're being charged and what exchange rate they're getting -
it is their money after all."
The company is launching its Project Payback offer:
giving customers back hidden bank charges when they switch to
TransferWise.
For October, TransferWise invites anyone who transfers money
overseas regularly to tell them how much the bank took in hidden
charges last time they made an international bank transfer. When
they then make the same payment during the offer period using
TransferWise, the company will return the money taken in hidden
charges by the bank previously.
The offer period starts 4 October. New UK customers can claim
back hidden bank charges from one transaction completed in the
three months prior to the date when they transfer again with
TransferWise.
Taavet Hinrikus, CEO and co-founder, TransferWise
added:
"At TransferWise we believe the lack of transparency in the
banking industry is deeply unfair, and we're doing everything we
can to make the situation better for consumers. That's why for one
month we're committing to giving back customers what the bank took
from them in hidden money transfer charges. It was yours - they
took it. We'll give it back to you."
Details of how to claim the offer can be found at:
http://www.transferwise.com/payback
* Research commissioned for TransferWise. Figures based on
8 million market size (17% of UK adults transfer money
internationally, Vision Critical, Jan
2014), and an overseas hidden bank charge benchmark of
4.5%
Notes to editors
TransferWise is the international money transfer platform based
on peer-to peer technology. Launched in 2011, it is one of the UK's
most successful fintech startups having raised $91m in funding from investors such as Andreessen
Horowitz, Sir Richard Branson,
Peter Thiel and Max Levchin, the co-founders of PayPal.
Co-founded by Taavet Hinrikus and Kristo Käärmann, the company
was created out of frustration with the high fees charged by banks
on international money transfer. TransferWise uses the real
exchange rate: the mid-market rate - without the hidden mark-up
fees - making it up to 10 times cheaper to send money abroad
compared to using a bank.
Over £500 million is transferred across the globe every month
using the TransferWise platform, saving customers more than £22
million every month. TransferWise is working to make the world a
tiny bit better by helping to make the financial system fair.
http://www.transferwise.com