When my co-founder and I launched TransferWise 7 years ago, we set out to irreversibly fix how money doesn’t work across borders.
Banks and money transfer companies had been allowed to run riot for decades. They were overcharging you. And in many cases they were simply lying about what you paid for moving your money.
So what if it we could spark this change? Could we bring prices down to where they should be: near zero, could we raise convenience and transparency to where they should be: instant and hassle free, and build a sustainable business in the meantime? What if we could even set a new global standard for international money? Perhaps for financial services, full stop?
Our mission is simple: Money without borders for everyone, everywhere - instant, convenient, and eventually free.
We began by building a way for you, the international people and businesses, to send money between countries, from one bank account to another. You’re now a community of 4 million people strong, spread across the globe, with wonderfully diverse lives.
The next building block to offer you was an alternative to the slow and expensive international banking - the world’s first truly borderless account. Since this launched you have put more than £2 billion into your borderless accounts. The best thing is that some of you have completely replaced your old bank accounts.
The third is our platform for banks, the TransferWise API, which the first large banks, both digital and traditional, are now connecting to, so that they can offer TransferWise to their own customers. By doing this, they’re choosing to earn their customers’ gratitude and goodwill over and above the short-term profits.
In the previous UK financial year, ending March 2017, we passed an important financial milestone. We broke even. This was an important but relatively low-key moment for us. It proved that international transfers can be done 10x cheaper than the banks - and sustainably, without making a loss.
Over the past 18 months or so, we have systematically become more efficient. We’ve begun using our scale to reduce costs, and passing that back to you in the form of reducing fees - to be even more than 10x better than banks. I wrote about how we think about fees in detail here. We will continue to drive the fees towards zero - to become more efficient as we grow, and to drop prices wherever we can.
In addition to reducing prices, we increased the investment into product - into speed, convenience and coverage. Among the team of 1200, we now have 70% more engineers working on our apps and infrastructure than last year.
Let’s look at it in numbers. In this financial year ending March 2018 you moved so much more volume that even with reduced prices you paid fees of £118m, (that’s 75% more than the previous year). Most of it we reinvested in price drops and into hiring more smart people to make your TransferWise experience better and available in more parts of the globe. We set aside a small profit of £6m for the rainy day.
The number we celebrate most is the amount of money we’ve saved you during the last year, compared to the banks you once used. You’re now collectively saving £1 billion every year by using TransferWise (see here how we know). Yet we’re just in the beginning - as banks around the world still rake in a handsome £160 billion from the cross-border fees hidden in the exchange rate.
You can download the full 2017-18 annual report here if you’re interested.
I’m incredibly proud TransferWise has proven that price transparency, a.k.a. not hiding fees in the exchange rate, is financially sustainable. We have proven that charging 10x less than banks is financially sustainable. We showed that an infinitely more convenient service than your traditional bank is financially sustainable.
These proofs take us to a new standard - the modern banks that are launching today no longer attempt to hide their fees. Their customers expect cross-border money to work as fast and cheap as it does on TransferWise. Our API for Banks only helps the banks to bring that new standard to you directly in your banking app.
Though we don’t really treat the release of financial results with any great ceremony, it does give a nice opportunity to reflect. And to consider all that’s yet to come.
Thank you, our community, for believing in us.
TransferWise Co-founder & CEO
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On March 15th, our pricing will be changing on all transfers from JPY. We know you'll want to understand exactly how this change affects you.