Should I Use Money Transfer Apps for International Payments?

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Last Updated on May 16, 2022 by Melissa S.

Sending and receiving money should be relatively easy, and it is – but it wasn’t always like this. For years, sending money abroad was a case of banks ripping us off or heading to a currency store. FX brokers were mostly used by businesses and using one required a lot of phone calls.

Money transfer apps changed the way we handle money entirely. Today, it takes all of five minutes to download a money transfer app and set up 10 different virtual bank accounts – all in different currencies. We can send money to an overseas freelancer or buy a meal on holiday for pretty much the interbank rate, and with hardly any fees. 

Whilst banks haven’t improved much on the FX and remittance front, it’s safe to say consumer choice is only growing.

Revolut: The Best Known Money Transfer App

Revolut is absolutely the best known money transfer app. In fact, Revolut helped drive these apps into the mainstream with its incredibly slick app interface, access to the interbank rate with no fees or margins, along with free multi-currency accounts.

This isn’t to say Revolut is the only money transfer app worth using, or that it’s the best, but it’s a peak example of how foreign exchange became so accessible.

For example, Revolut offers a free debit card (though, sometimes it costs £4.99 for delivery). This card can be used like any other Mastercard – in overseas ATMs and restaurants. The need to exchange your currency before travelling is completely gone with this card, because you can use it as and when you like, with an unbeatable exchange rate.

Of course, it’s not only for holidaymakers, but also for small businesses, making online purchases, investing, and so on. We can make large purchases in foreign currency and avoid the 2.5%+ fees that some credit cards charge. Often, this charge is hidden too, like with marketplaces taking control of the conversion (and doing it in an expensive way!)

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Photo by August de Richelieu on Pexels.com

Buying and Selling Online Using Apps

The best money transfer apps have increased the efficiency of payments for both buyers and sellers to an incredible degree. For example, Amazon charges sellers upwards of 3% for exchanging money. So, they let buyers pay in their own domestic currency, different from the seller’s, and the seller is left 3% worse off.

This can completely ruin an Amazon seller’s business, and some aren’t even aware of how terrible this rate is. To avoid the potentially thousands of pounds lost per year in revenue, the seller could sign up to a money exchange app in a couple of minutes, for free, and open an account to receive the revenue in.

This way, the seller is receiving the seller’s currency in its base form with no unwanted conversion. Sure, this means the British seller may be receiving Euros, but they’re receiving the right amount this time. The seller can exchange these Euros (or wait for a preferable rate) with no fees and at most, a 1% margin.

The same goes for buyers, of course. Consumers are increasingly turning to eCommerce for their shopping, meaning more overseas purchases are happening. Without relying on the terrible bank card payment system or PayPal, buyers can buy the goods in the seller’s own currency for a rate they know is good.

This sounds like a lot of effort for the average consumer, but it really isn’t. Not only can a USD wallet be opened within 10 seconds, but it’s not even needed. The online money transfer app will make the conversion for the customer with a good rate guaranteed – just make sure the website’s payment solutions aren’t trying to take control of the conversion. Usually, you can spot it by looking at the GBP quote

The Top 5 Money Transfer Apps & Accounts

Whether the best way to transfer money abroad – whether via banks, via brokerages or via apps depends on the wants and needs of the customer, which is why we have detailed a list of five very different companies, all of which are the best in their area.

Wise

Like Revolut, Wise (formerly TransferWise) is aimed at accessibility. Its target audience is everyday people looking to spend money on holiday, receive their pension as an expat, or to buy goods online. Initially, it appears more expensive than Revolut, but given Revolut’s low free limits means that they both can quickly become similarly priced. This makes it a matter of preference in regards to features and UI.

OFX

OFX is slightly different to Wise and Revolut. With a £/$/€ 100 minimum transfer, OFX isn’t for petty cash and holiday spending. Instead, it offers solid value for large, secure overseas transfers. OFX also offers a dedicated dealer with great business support, making this a more comprehensive, bespoke service – but also less accessible.

Revolut

Revolut became Britain’s first digital bank unicorn for a reason: it’s incredibly easy to use, has a popular freemium model, and is increasing its arsenal of features at an alarming rate. Not only can you have the accessible Wise-like multi-currency account wallets, but it’s also a place to split bills, invest in crypto and stocks, and open savings’ vaults. This makes it one of the best apps for international payments, proving they’re not large in value.

Moneycorp

Whilst all of these firms are safe and credible, if you’re looking for reputability, Moneycorp is perhaps a good choice. The industry veteran has been offering competitive rates since 1979, and has received positive customer and media reviews ever since. Whilst the mobile app may not be quite as slick as Revolut or Wise, they offer sophisticated payment solutions, hedging, dedicated guidance, and a separate experience for businesses.

Currencies Direct

Currencies Direct is a bit like OFX with its £/$/€ 100 minimum transfer, though it could be described as the most like platform out of the five. There is a strict policy of never having any fees, yet the multilingual staff offer incredibly comprehensive support and have particular expertise in overseas property. They’re well regulated, have great business support, and have very competitive exchange rates.

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