Most people are unaware of what they actually pay to send, spend, or receive money internationally. That’s because providers mislead consumers on exchange rates. They often say they have low, or even no fees, but they might hide extra fees in a marked-up exchange rate.
Please share your story by answering the following questions:
What is your name?
Where are you from? Where are you living now?
Why are remittances important for you?
How much does your family rely on remittances back home?
Do you find pricing confusing when sending money abroad? Does it make it hard to shop around for different providers?
Are you aware of additional fees hidden in exchange rate mark-ups?
If so, how are hidden fees impacting you and your family?
Remittances provide vital support to approximately 1 billion people globally, contributing to achieving the United Nations’ Sustainable Development Goal 10c of reducing remittance costs to 3% by 2030. We're urging governments to promote transparent pricing in cross-border payments to achieve this goal. People like you deserve to know the total cost of sending money abroad and make informed decisions. Learn more about the state of transparency around the world.
Join us to fight against hidden fees and help convince the government to eliminate them.
There should be nothing to hide
Sending money abroad is a big deal for many people living international lives. You might be supporting your family, planning your next adventure, or expanding your business. But did you know that most people are unaware of what they actually pay to send, spend, or receive money internationally?
That’s because international money transfer providers often mislead people on the fees they charge. They may say they have low, or even no fees, but they hide extra fees in a marked-up exchange rate. In fact, there's only one that you ever need to care about: the mid-market rate, like the one you see on Google.
hidden fees
£187 billion! That’s how much people and businesses lost to hidden fees in a single year.
Remittances are vital for millions of people worldwide. But today, it’s still expensive to send money cross-border, with the global average at 6.3%. The international community wants to fix this. The United Nations Sustainable Development Goal 10c aims to bring down these costs to less than 3% on average by 2030.
We urge governments to promote transparent pricing in cross-border payments to achieve this goal. People like you deserve to know the total cost of sending money abroad and make informed decisions. Our campaign, "Nothing To Hide," seeks to make hidden fees illegal, ensuring full transparency for consumers everywhere. Join us to fight against hidden fees and make a difference!
[state of transparency]
The state of price transparency
How much are people losing to hidden cost ? ๐ค
● European Union ๐ช๐บ (EU) lost €12.5 billion
● Canada ๐จ๐ฆ lost $13 billion
● USA ๐บ๐ธ lost $8.7 billion
● UK ๐ฌ๐ง lost £5.6 billion
● Australia ๐ฆ๐บ lost $3.1 billion
In the European Union, €12.5 billion is lost to hidden exchange rate mark-ups.
The good news is that the second Payment Services Directive (PSD2), designed by the EU, prohibits financial service providers to use non-transparent pricing methods for international payments. The bad news is that these rules are badly enforced and loopholes in the law enable providers to add extra costs hidden in exchange rate mark-ups. Unfortunately, the rules only apply to transfers within the EU.
●In the United Kingdom, £5.6 billion is lost to hidden exchange rate mark-ups.
A law called the Cross Border Payments Regulation, which was adopted by the UK, requires banks and transfer providers to disclose the total cost of international money transfers - including those hidden in exchange rate mark-ups. Sadly, like in the EU these rules are also badly enforced and only apply to transfers from GBP to EUR. Remittance price transparency should be extended to include all money transfers from the UK and EU to any other currency in the world.
●In Australia, $3.1 billion is lost to hidden exchange rate mark-ups.
The consumer watchdog, the Australian Competition and Consumer Commission (ACCC), has issued guidance that requires international money transfer providers to disclose upfront the amount a recipient will receive. However, the existing rules are too loose, as providers are not required to disclose that they are hiding extra fees in a marked-up exchange rate.
●In the United States, $8.7 billion is lost to hidden exchange rate mark-ups.
Currently, there’s no rules banning hidden fees in the exchange rate, but the consumer watchdog, the Consumer Financial Protection Bureau (CFPB) wants to make it easier for people to understand the fees charged by international money transfer providers when sending money abroad. The CFPB is considering taking action to improve how fees and exchange rate mark-ups are displayed. This idea has gained support from US Senators, consumer and immigration groups, and an industry trade association. The goal is to provide clearer information to people, helping them make better decisions when sending money abroad.
●In Canada, $13 billion is lost to hidden exchange rate mark-ups.
At the moment there's no rules banning hidden fees in the exchange rate, but the Canadian government has previously made a commitment to lowering the costs associated with transferring money from Canada to other countries. Following in the footsteps of the US, the 2023 budget plan outlines new steps to put money in the pockets of people who need it the most, cracking down on junk fees, except in hidden exchange rate mark-ups. Any plan to end junk fees should include cracking down on hidden fees when Candians send money abroad.
The solution: a global standard for remittances
Governments can make simple changes to improve remittance price transparency and reduce costs. If providers use a benchmark exchange rate provided by a trusted source and subtract fees from the amount being sent, it would enable fair price comparisons and eliminate hidden fees. Consumers would be able to compare send amounts, fees, and receive amounts easily. If all banks and providers adopt these practices, the market would become transparent with consistent pricing. It is important for the international community to support these changes, as they would benefit consumers and help achieve the goal of reducing remittance costs to 3% by 2030.
[global standard]
Transparency is at the core of our mission
At Wise, we believe in making finance fairer and ending hidden fees. Unlike banks and other providers, we tell you exactly the cost of your payments—no hidden fees, no unpleasant surprises—and offer fair, mid-market exchange rates for converting your money. Whether you're sending money to support your family, planning an exciting adventure, or growing your business, choose Wise. We prioritise transparency and have nothing to hide.
move-and-manage
Sources used:
●£187 billion lost to hidden fees - First financial results as a public company
●AU¹, EU², CA³, US⁴, and UK⁵ - Hidden fees research conducted by Wise between August 2017 to March 2023
AU (here ¹) ,
EU (here ²) ,
CA (here ³) ,
US (here ⁴) ,
UK (here ⁵) .
●The World Bank - Global average cost increased from Q2 2022 to Q3 2022
(Read overview below)
●2023 Remittance Report - Can G20 sending countries achieve the UN goal of 3% costs by 2030? (here)
(Sources last checked on date: 26-May-2023)
2023 Remittance Report
Overview
Remittance Prices Worldwide (RPW) monitors remittance prices across all geographic regio.world. Launched in September 2008, RPW monitors the cost incurred by remitters when sending moneyalong major remittance corridors. RPW is used as a reference for measuring progress towards globalcost reduction objectives, including the G20 commitmentreduce the global average to 5 percent,which is being pursued in partnership with governments, service providers, and other stakeholders.
Since Q2 2016, RPW covers 48 remittance sending countries and 105 receiving countries, for a total of367 country corridors worldwide. RPW tracks the cost of sending remittances for four main RSP types:Banks, MTOs, Mobile Operators, and Post Offices. MTOs include both traditional providers andinnovative/fintech players. On average, 16.3 services per corridortracked.
This Report uses data from RPW's most recent release to analyze the global, regional, and countryspecific trends in the average cost of migrant remittances.
FXC Intelligence provides the underlying data used in the RPW.
Key findings
The Global Average Cost increased from 6.01 percentQ2 2022 to 6.30 percent in Q3 2022.
. The International MTO Index experienced a decrease over the quarter to 5.93 percent in Q3 2022,from 6.17 percent in Q2 2022. It is the first time this figure is belovGlobal Average.
The Global Weighted Average Cost decreased to 4.68 percent in Q3 2022 from 4.80% in Q2 2022.ThelobalSmaRT Average Cost for Q3 2022 was recorded at 3.14 percent. This is a 0.21 percentage point decrease from its Q2 2022 level of 3.35%.The Digital Remittances Index increased from 4.80 in Q2 2022 to 5.21 percent in Q3 2022.
The Digital-only MTO Index experienced an increase to 4.38 percent in Q3 2022 from 3.84 percentin Q2 2022.
South Asia remains the lowest cost receiving region, withaverage cost of 4.94 percent. SubSaharan Africa remainsmost expensive region to send money to, recorded at 8.46 percent totalaverage cost in Q3 2022.
Banks remain the most expensive typeservice provider, with an average cost of 11.69 percent.
The proportion of corridors with average costs of less than 5 percent has increased considerablysince Q1 2009 (from 17 percent to 42 percent in Q3 2022).
In Q3 2022, mobile money remains the least co instrument to originate remittances and wasthe least cost instrument to receive remittance
https://wise.com/gb/blog/first-results-public-company
You know Wise
No comments:
Post a Comment