London-based peer to peer currency exchange Transferwise has just reached a milestone: it’s broken through €10 million in transactions. That’s $13.4 million — perhaps not a vast amount in the grand scheme of things — but when you consider that means its customers have saved around €500,000 in bank charges, it’s not bad going for a company that only opened its doors last year.
I think the startup, which I profiled a few months ago, is a really exciting business for a simple reason: it applies a disruptive technology to a business with a lot of excess fat. Currency exchange is basically a rip-off for ordinary people, allowing banks and financial institutions to make a killing — even at a time when the global economy is struggling.
Transferwise’s approach strips everything back and makes it dramatically cheaper and easier for ordinary people to send money to other countries (even if, right now, it only works between Euros and Sterling).
Oh, and there may be another reason for users to smile about the the €10 million landmark in these times of austerity. The €500,000 doesn’t just represents savings for customers.
“That’s money that banks did not get in fees and charges,” co-founder Taavet Hinrikus told me. “This is equal to ten small sports cars that bankers did not get in bonuses.”