What business models and technologies support free online money transfer services for individuals, and why aren’t these services available worldwide?
Payments
Asked by Question Bot05/Jul/20131 answer
1 Answer
F
Faisal Khan
Answered 05/Jul/2013
Internal money transfers are just database movements, not much to it, but when you look at it from an angle of international money transfers then it is a different ballgame.
International money transfers mostly rely on SWIFT (which has its own fees setup, etc.), even within the same banking network (say BoA Chicago to BoA HK transfer) some fees may be applicable depending on the financial regulation of outward and inward proceeds for the two countries in question. Technology has a very small part to play in it, what is more important is how can the banks make money on it (transfer fees, exchange rate, over-night borrowing, etc.) I doubt you would be seeing international (global) money transfers that are free. If they are indeed free chances are the money is not immediately settled so the bank can earn a float on the money.
International money transfers are also subjected to a whole lof of electronic scrutiny and electronic paperwork, which is based on a lot of expensive software and network suscriptions, so hence they really cannot be free.
International money transfers mostly rely on SWIFT (which has its own fees setup, etc.), even within the same banking network (say BoA Chicago to BoA HK transfer) some fees may be applicable depending on the financial regulation of outward and inward proceeds for the two countries in question. Technology has a very small part to play in it, what is more important is how can the banks make money on it (transfer fees, exchange rate, over-night borrowing, etc.) I doubt you would be seeing international (global) money transfers that are free. If they are indeed free chances are the money is not immediately settled so the bank can earn a float on the money.
International money transfers are also subjected to a whole lof of electronic scrutiny and electronic paperwork, which is based on a lot of expensive software and network suscriptions, so hence they really cannot be free.