The reasons for TransferGo’s existence and the company’s commitment to help others in a number of areas, other than just financial, can be found in a phrase the company co-founders heard often.
“It’s against our policy”
Prior to launching TransferGo in 2012, the company founders were engaged in a traditional import/export business. This experience taught them a great deal about dealing with various regulatory agencies, especially banks.
The fees charged by the banks for processing payments in other countries and currencies were incredibly high. The attitude of the banks only added to their frustration. One bank sent a payment not only to the wrong country but also in the wrong currency, resulting in loss of revenue and reputation. Another bank asked that they move their accounts and provided no explanation. In both cases the answer they received was that providing explanations and possible restitution was “against policy.”
TransferGo is founded
The founders realised that the problems they faced were not only shared by businesses but by many individuals who needed to make international money transfers. Migrant workers were particularly impacted not only by the bureaucracy but also by the fees imposed.
The average migrant worker sends approximately $12,000 (US) to their family per year. Often this is the equivalent of adding another full time wage earned to the family and can spell the difference between near poverty and a middle-class standard of living.
The founders also realised that tapping the power of the internet and smartphones was particularly important. They reasoned that by allowing users to send money home via their smartphone using a process that was already familiar to users was a fair easier and less expensive method than dealing with banks or the traditional money transfer systems such as Western Union.
TransferGo’s solution was new and innovative. Instead of transferring money from one country to another the company took a “local in, local out” approach. Instead of transferring the funds, TransferGo accepts a deposit to their account at a local bank and makes a payment to the recipient from their bank account it that person’s country. This saves the services users about 90% on the cost of sending money home which benefits both the sender and the recipient.
TransferGo’s Success So Far
Starting with basically zero capital in 2012, TransferGo has experienced phenomenal success. They completed the somewhat arduous task of acquiring their small payment institution license. They were accepted as a member of Level39, the largest accelerator space for tech businesses innovating in finance sectors in Europe. TransferGo also became a founding member of Innovate Finance an industry group that supports the next era of technical financial services innovators.
TransferGo received the “2013 Most Innovative Business Talent Award” from the Danish Chamber of Commerce and Lithuanian news portal Delfi. The company has also received a silver innovation prize at Japan’s HackOsaka.
During the company’s somewhat short existence they have been able to offer their services by setting up accounts with partner banks in almost 30 countries, expanded its mobile service applications, added additional language options to their website and secured additional investment capital to help further expand their services.
In a recent Financial Times interview, co-founder and CEO Daumantas Dvilinskas provided additional background on TransferGo and how the company works in the competitive FinTech sector.
From its humble beginnings with a staff of four to today where the staff numbers twenty dedicated and experienced experts, TransferGo has not lost sight of the impetus behind the company’s founding. Endeavours such as the company’s YouTube channel and this blog are just a part of the commitment to not only serving their customers but to also empowering them. “It’s against policy” is not part of the TransferGo experience.