According to currency exchange experts TransferMate, more and more Irish businesses turning to the experts to find out the ways by which they can protect themselves against currency fluctuations post-Brexit.
Experts at the Irish FinTech say that now, more than ever, businesses that conduct any overseas currency transfers need to look at their processes for these transactions.
Barry Dowling, co-founder, TransferMate explained: “Basically the banks have long since been the traditional foreign exchange provider – but the truth is they have been overcharging many of their customers for years now. Even though technological advancements have led to increased competition in this market, the majority of Irish businesses still use their bank when it comes to sending and receiving foreign currency payments – and in many cases doing so costs businesses thousands of euro in needless fees and charges.”
TransferMate contend that the prices banks are charging Irish SMEs on currency exchange are “over the top” and that is having the knock-on effect of hundreds of millions being taken out of the Irish economy each year.
Dowling continued: “Over €75bn in foreign currency is exchanged every year by corporate SMEs in Ireland, whether it is collecting payments or sending payments. Banks are charging exorbitant fees to change this into foreign currency and we estimate that in excess of €200m is lost to the economy every year in bank fees and charges.”
Up to now, the traditional foreign exchange provider has been the bank. Banks are still using legacy systems to manage foreign exchange and are simply not in a position to provide SMEs with a competitive proposition.
Many of the traditional banks charge fees of up to €30 for same day payments and apply a foreign exchange margin of up to 3%.
Experts at TransferMate note that greater competition in the FX market in Ireland can only be good news businesses.
“Our success has been based on the appetite to move from using the bank to secure cheaper faster deals on their foreign exchange payments,” said Dowling. “We see the very same thing in Ireland as we see in other key markets like the UK and north America and that is companies are beginning to sit up and use fintech solutions as a way of seeing real savings and in many cases all it takes is an accountant or business owner to take a closer look at their bank charges and compare.”