The battle to be the best overseas money transfer service is hotting up.
Revolut, has announced that it is scrapping its 0.5% fee on all international money transfers under £5,000 pounds sterling.
The 2-year-old fintech startup has raised more than $15m from well-known London VCs such as Index Ventures and Balderton Capital.
Revolut founder Nik Storonsky has not been shy in calling out Transferwise. Transferwise is currently the most used and best funded money transfer startup in the UK.
“Despite the rhetoric from many companies claiming to eliminate fees and offer the cheapest rates, Revolut is the only company letting you transfer up to £5,000 each month for free”, Storonsky has been quoted as saying.
Speaking about the launch of Revolut’s Turbo service, which allows customers to pay £5 to speed up transaction times from three to five business days, to between one and two, he said.
“The launch of our Turbo will give our customers the option to speed up transfers to one to two days while still being cheaper than the likes of TransferWise and Western Union.”
Revolut’s bold strategy
It’s a bold move on the founders’ part to issue a challenge to both TransferWise and Western Union. Revolut, however, have showed that they are prepared to innovate in order to scale their business model.
The company recently launched an Amazon-Prime style subscription service, allowing users to pay a monthly subscription fee to the company in exchange for unlimited fee free transfers and additional features.
Revolut have also partnered with disruptive mortgage broking service Trussle. Trussle are now providing their services directly through Revolut’s app, which has more than 360,000 users in the UK alone. Globally, the number of users exceeds half a million.
There is also a Revolut for Business launch in the pipeline. The new feature has already attracted more than 10,000 pre-registrations, and will offer expense reports, corporate cards, and of course, international payments.
Fintech firm’s versatility
Revolut is a good example of the way a modern fintech firm can branch quickly into different areas. The range of services on offer include overseas payments, to mortgages, to business services. Revolut even has a bill splitting service that groups can use when abroad to ensure everybody pays the right amount.
It’s all to do with the way the tech industry has developed Application Programming Interfaces, or APIs as they are more commonly known. API’s are able to obtain and share information from many different sources.
Revolut are currently preparing for another funding round, and launching a second crowdfunding campaign. Their first campaign, which raised $1 million, was oversubscribed.
It’s amazing what you can do with an API and a bit of ambition these days. Once you have the tech licked, as Revolut are currently demonstrating, you can enter almost any digital market. Then, it is all down to your service.