TransferWise Bridges Gaps for Overseas Payments and UK Business

September 17, 2015

in Manage Your Finances

Authored by Mark Stimpfig

TransferWise Bridges Gaps for Overseas Payments and UK Business

TransferWise, a London-based firm, allows people to make international money transfers among 292 currencies using a peer-to-peer system, with plans to add another 300 this year.

The company recently raised $58 million in Series C funding, giving an estimated valuation of as much as $1 billion, and paving the way for this U.S. expansion. TransferWise’s current investors include Sir Richard Branson and Peter Thiel. In total, TransferWise has raised $90.4 million since being founded in 2010.

Between its two U.S. locations in New York City and Tampa, Florida, TransferWise has 50 people on staff stateside, with plans to nearly double the U.S. staff size within the year. Overall, the company has a staff of 400.

In turn, the company recently partnered with an unnamed U.S. institution to position itself in other American markets, according to the New York Times.

Company founders believe the money transfer market is ripe for disruption thanks to the spread and maturity of the Internet, as well as increased transparency expected by consumers. Changes in U.S. consumer behavior, due to increasingly pervasive technology, were becoming difficult to ignore. People are more trusting of online financial transactions, making this another example of how financial tech is a strong investment channel.

Since its launch, the company says users have transferred $4.5 billion around the world. Recent estimates indicate 15 to 20% of the U.S. population was born outside of the country, many of whom have a need to send money overseas.

TransferWise claims its services are, on average, 8x less expensive than the transfers offered by traditional banks. They’re able to do that since its peer-to-peer model uses a proprietary algorithm to match customers with their counterpart in another country looking to transfer money in the other direction, avoiding currency-exchange firms and banks.

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