Sending money across borders has become a daily task for many people and companies, and finding the best and most reliable ways to do this is very important. However, some problems, like high fees, slow transaction times, and a lack of transparency, can make this money-transaction process quite questionable, so it is always better to look for trustworthy companies that people can rely on. Fintech is one of them, and here, we will let you know some important information about how it is transforming cross-border money transfer.
Why are the old ways so complicated and outdated?
Before fintech arrived, cross-border money transfers were quite complicated and slow, as it was overwhelmed with higher fees, slower processing times, lack of transparency, and general inconvenience. For example, international money transfers charged hefty fines, which included a flat rate, a percentage of the transfer amount, and many hidden fees along the way. Then, the whole process used to be quite slow, taking anything from several days to several weeks or even months, which was quite frustrating. Lack of transparency used to be a serious security issue, as both senders and receivers were uncertain about the exact amount that was sent and received and whether some percentage of the money was taken away during the process. Finally, filling out so many documents, waiting in long lines, and the need to visit a physical branch made this money sending very inconvenient. Luckily, all of this is a thing of the past, and nowadays, we have so many amazing and innovative ways to send money all over the world.
Lower costs
One of the main benefits of using fintech solutions instead of traditional options is that it is much cheaper. Because it is able to remove many intermediaries, this means that they are available for less money. Peer-to-peer payment solutions offer people the exchange of their currencies, and they do not have to go to a bank to do anything. By doing this, they can bypass all the fees that banks charge to make the exchange happen. Also, by using fintech, you will know how much money you are paying upfront if there are any additional fees, making everything more transparent and safer to operate with.
Faster transactions
The fact that you don’t have to wait for so many days or weeks to send money to someone abroad is one of the best things about fintech, as it can streamline the whole process and make it as quick as in the matter of minutes or hours. For example, if you want to send money to India, you can do this anytime, from anywhere, and even track your transaction online, so you will know when the recipient will get the money and whether there are any issues. The best thing is that you can transfer money directly to the person’s bank account, so they don’t have to go to physical branches to withdraw that money, but rather they can use the app or credit card for whatever they need. This makes it much easier for people and businesses to send money all over the world, and also, such transfers are usually fee-free, where money is transferred the same day.
Increased access
Another huge benefit of fintech solutions is that people can access it much more easily no matter where they are. There are many places in the world where the infrastructure to do a certain transaction is simply not there, and they have to look for other options. Using payment apps or digital wallets in this situation is the way to go about things. Most people nowadays have a phone, so these are much better options than what was available to people. These options are really important for people who like to travel to remote places in the world. All they need is a stable Internet connection and they can achieve a lot.
Better transparency
As we have said, lack of transparency was one of the main issues with old transaction ways, as people never knew whether the right amount of money will get to the desired destination. With fintech, this is a thing of the past, as you can track everything through an app, and you will have a clear insight into what is happening with your transaction, so you can make the best decisions at the right time. This is especially important if you are working abroad and are sending large amounts of money to your family back home, who depend on this income, so you can track whether they have received it successfully and if there are any hidden fees you should be careful about. Fintech is making this whole process safe and transparent, so you won’t have to worry about any issues and frauds, as you will have everything recorded and monitored through an app, providing you and your loved ones with the needed peace of mind.
Blockchain and cryptocurrencies
In recent years, we have seen a boom in the use of blockchain technology and cryptocurrencies. This technology has enabled many people to do things that were not possible before. Because of the security and transparency this technology offers to people, it has become a great substitution for traditional ways of transferring money, such as through banking. The use of crypto has enabled people to transfer their money without having to pay large amounts of it to the banks. In areas where currencies are not stable enough, many people decide to use stable coins that are connected to the value of a currency that is much more stable, like the US dollar. People do not have to worry that their money will all of a sudden become worthless because they have transformed it into something much more secure and stable.
Without a shadow of a doubt, fintech is changing the way people deal with their money transactions. Beforehand, we were too reliant on banks and similar institutions when it came to money transactions, but now the tech improvement has taken away the monopoly that they once had.
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