TransferWise tackle fees and exchange rates with new debit card
Online money transfer service, TransferWise launched a debit card in Australia on Thursday allowing millions to access money across the globe to combat no transaction fees and no “sneaky” exchange rate mark-ups.
The new card contains almost no fees and will let consumers spend at the real exchange rate (as seen on Google).
Consumers can also withdraw up to $A350 every 30 days for free at any ATM in the world.
Capital Economics research conducted for TransferWise found Australians lost a staggering $2.14 billion in 2018 alone on overseas card transaction fees.
The same research found in the last five years, transaction fees on travel and prepaid cards have more than doubled from $70 million to $174 million.
When it comes to exchange rate mark-ups, bank-issued travel cards and prepaid cards are the worst offenders compared to other payment methods, costing Aussies $188 million last year alone.
Further research from RFi Group found 13 per cent of travellers used a prepaid card for their trip as it allowed them to lock in exchange rates, while a large 31 per cent preferred cash.
Market use of debit cards was 48 per cent, with ING debit usage at a high 64 per cent as of March 2019.
According to TranfserWise, spending $1000 in New Zealand could cost up to $46 with a bank issued card, however with TransferWise it would cost $4.80.
As a result, the company said their service on average is eleven times cheaper than most popular travel debit and prepaid cards, offering significant savings when spending in New Zealand, the UK, US, and Europe.
A trip to Europe stands to lose close to $300 in fees when spending $5000, whereas with TransferWise, it would cost them only $55 according to the company’s independent research conducted by Alderson Consulting.
Kristo Käärmann, CEO and co-founder at TransferWise said consumers shouldn’t be punished for spending aboard.
“Aussies are known the world-over for being prolific travellers. Working and living overseas is a rite of passage for many, so we think it’s unfair that your bank punishes you simply for wanting to spend your own money abroad.
“As of today, exorbitant, non-transparent fees on international transactions are a thing of the past.
“TransferWise’s aim is to bring fairness into the finance sector and we’ve designed an innovative, smart debit card packed with lots of features, so you can enjoy more of your own money whether you’re going overseas on a holiday, are an expat, a digital nomad or using it for business.”
The card will also allow customers spend up to 40+ currencies at the real exchange rate.
“We’ve made it incredibly cheap and transparent to spend money internationally with our card, even if you don't have the right currency. If you have the balance of the currency for the country, you're in, it will simply deduct the amount from that.
“If you don't have any of the domestic currency, the card will automatically convert the currency for you at the same rate you see on Google.”
“We’re looking forward to Australians using our card all over the world and it won’t be long before our customers in Singapore get the card so they too can save.”