Online money transfer companies are increasingly challenging traditional banks by offering lower fees. Ciara Lee visits Azimo, a company seeking to reduce the cost for migrant workers of sending money home.
It's a global industry worth 500 billion dollars a year. Companies such as Western Union and Moneygram, as well as high street banks have dominated the money transfer market for years. But that could be about to change. Azimo is a digital firm that's cutting out the middle man by allowing users to transfer money directly from their phones of tablets pads. Its customers are predominantly migrant workers in the service industries, sending money back to Poland, Africa, Latin America and the Far East. Michael Kent is the company's CEO. (SOUNDBITE) (English) FOUNDER AND CEO OF AZIMO, MICHAEL KENT, SAYING: "We thought, things could just be so much better if you applied mobile technology, social technology on to what is a pretty old fashioned service, you could actually make much more cost efficient, much more transparent and just easier to use. We thought of migrants as potentially less technology literate and actually when you go out and ask them, migrants are all on Skype, Facebook. They're heavier users of social media and digital technology than anyone else." Azimo is one of a number of fully-regulated online businesses carving out a chunk of the market in international money transfers, travel money and card payments. It's grown around 25 percent month on month since it began. The rise comes as the reputation of traditional banks falls. Heavy fines for currency market manipulation the latest blow to some of the top global lenders. (SOUNDBITE) (English) FOUNDER AND CEO OF AZIMO, MICHAEL KENT, SAYING: "Twenty years ago you would ask people if they trusted their bank and everyone would say yes. I think now if you asked people if they trust their bank they're very unlikely to say that so I think there is definitely a perception problem in the financial services industry. There are lots of new players like us who can say we're just going to be honest about how much it costs, be honest about how long it takes, and be honest about how much money we are making." Azimo says that in an era of electronic money, the 4-12 percent fees banks charge are too high. To transfer 100 pounds to Germany through a high street UK bank would cost around ten pounds. The fee at Azimo is a 10th of that.