Transferring money to loved ones and businesses abroad can be tedious when having to convert currencies every time a transaction is being made. It can also be just as annoying for the recipient to convert the money to their preferred currency.
This is when a multi-currency bank account can provide many benefits for individuals and businesses. Convenience and versatility are only a few of the reasons why these accounts have gained traction over the last year.
Since March there have been more online money transfers internationally than ever before as many families have provided each other with financial assistance and businesses have begun outsourcing to independent workers who work outside of the country in which the company operates in.
Multi-currency bank accounts allow clients to keep money in different foreign currency accounts through one service provider. With the ability to access all your currency holdings in one space, these accounts allow businesses to control their own currency exchanges when paying freelancers, suppliers, or technology companies.
Due to lockdown measures, there has been an obvious increase in remote business and those working from home are now able to complete transfers with ease as these accounts are becoming more readily available.
If you’re interested in a multi-currency account you’re likely looking for the best bang for your buck, especially if you’re exchanging money from different currencies on a regular basis. The benefit of these accounts is that you don’t have to check what margin the company is taking for every transfer.
Transparency is key when handling multiple currencies for those sending transfers and their recipients. “If you’re having to use the account all the time, it's way as well as a swift modern app with a geometric password and a speedy user interface. Compare this to the traditional method of speaking on the phone or a physical branch, it’s incomparable” Tech Times reports.
While using multi-currency accounts your exchanges are instant and seamless; these types of accounts are typically more successful in small businesses with less complex infrastructure and market shares.
World First, OFX and Transferwise are three of the most popular companies that offer a multi-currency wallet. There are benefits to each of these platforms; OFX is based out of Asia with offices in Singapore and Hong Kong. The company is best known for the best Asian currency exchange rates since they target the Asian continent to provide their services.
World First is known for supporting a broad basket of currencies, offering services in over 130 countries. This allows their users to facilitate their businesses across international markets since converting exotic currencies are supported by their company.
Transferwise is an app-focused company that is fairly new to the market. With fast service and a sleek style, the company is aimed at those with a strong understanding of the financial market. Their app allows you to find your virtual bank account details for each of the currencies with ease, making it even easier to receive payments.
“Money transfer companies, for the most part, have access to the interbank rate” meaning they receive a mid-market rate which is the same as large investment banks around the globe. Companies could charge a fixed rate or take a profit off each transfer which is the only way they can generate revenue.
Multi-currency accounts with cheap rates are causing big banks to suffer, as well as “online marketplaces that exploit the lack of access to good rates.” Many banks and companies will have to figure out how to reduce their margins in order to keep up with multi-currency companies that are able to facilitate currency conversions and transfers at lower rates than ever before.
There are now many options for clients to financially function on an international basis, and with affordability being a priority this year, the market can expect a continual upward trend of individuals and businesses gearing towards the use of multi-currency wallets.
By Surina Nath