Financial technology firm, Wise, a London-based fintech firm, has announced its entry into India. The firm specializes in peer-to-peer forex transfers. On June 1, 2021, the firm stated that users in India would now be allowed to send money abroad to 44 countries worldwide, including countries in the Eurozone, Singapore, the UK, the USA, the UAE, and more.
India has an imbalanced outward to inward remittance ratio, as the data reveals. As per the Reserve Bank of India, the country’s outward remittances in the fiscal year 2019-2020 were around $18.75 billion, with more than 60% of it categorized under travel and foreign education fee. Comparatively, the inward remittance market is bigger as Indians abroad send money back home. According to data from the World Bank for the year 2019, the personal remittances received in India exceeded $83 billion.
Wise has tied up with RBL (formerly Ratnakar Bank) under the Liberalised Remittance Scheme (LRS) to send money abroad. “Transfers to Indian Rupees (INR) were first made available in 2013, and the company recently enabled Google Pay users in the United States to send INR to Google Pay users in India,” a press release issued by the firm said.
Wise specializes in cross-currency money transfers, which can entirely be done online. The firm claims that its service is faster and cheaper than other fintech players and traditional banks, which serve a large cut and offer unfavorable exchange rates. According to Wise, the research firm Alderson Consulting conducted an independent analysis that showed the company’s prices for international money transfers are on average twice cheaper than banks and other providers. For example, sending `50,000 to the United States costs `1,909 on average with other banks, but only costs `1,038.08 with Wise.
The Urgency on Currency
Money connects the world like nothing else, and through the years, India has emerged strongly in the business market. We have a multitude of dealings of a cross-national nature – from online retailers to small businesses that aim to go global, students that require money from their families, and vice versa.
It wasn’t surprising then that the ability to send money out of India was one of the most heavily requested services the company received from users, as per CEO and co-founder of Wise, Kristo Kaarmann. “Over the last, like almost a decade now, the build-up of local payments infrastructure and UPI has been fascinating to observe,” added Kaarmann. Furthermore, he did not provide details about potential partnerships in India but did announce the opening of a local office in Mumbai, India.