You know the drill: you’ve promised to send money to India. And grandma Abhaya is expecting she’ll get that money in no time! Then you end up spending days juggling between unhelpful customer support agents. And explaining to grandma—how sometimes, the money you send gets stuck in the air. All while trying to sound believable.
The revolution that TransferGo’s collaboration with Ripple brings to slow and expensive money transfer processes is akin to what phones did to letter-writing. Less effort, less time and fewer costs for better results. (Can you feel the love-letter-toting romantics already turning their noses up at this? How dare we hate on letters?)
Anyway, here’s what’s changed about how you send money to India.
Send money to India: how it used to work
Stripped bare, the process of how you send money to India and across borders is simply communication.
Let’s get into imagination mode. You had money in bank account A that you needed to get to grandma’s account in bank F in India. You’d tell your bank what you want (amount, the recipient, how fast you wanted it to get there etc.). The bank would then send a fast runner with a letter (thought those days were gone?) to the recipient’s bank with your instructions. If your instructions were received and verifiable, the recipient would be able to withdraw your money.
Wait, when you send money, is it still your money or theirs? Mhmm!…let’s debate that after you’ve paid the hefty transaction fees.
The route that this communication takes represents the payments infrastructure that you’d use and this is what Ripple has revolutionised. The road the runner followed represents the money transfer system used by banks, which you’ll pay for. You’ll also pay for getting the letter through the border in the form of cross-border money transfer fees.
How it works with TransferGo and Ripple
From the above analogy, the following changes were made to the process of getting your money to India:
- The runner was eliminated (anybody looking to hire a runner, kindly reach out).
- Letters were no longer needed to cross the border (no cross-border fees).
In the new system, bank A gives the money to a service like TransferGo when you sign up. Instead of a letter, an electronic message is sent to a partner bank in India to pay grandma the money. Since money does not actually cross borders, you save on fees and the currency is exchanged at mid-market exchange rates.
Before Ripple, TransferGo would have to find individual banking partners and integrate with them, which would cost time and resources. However, with the integration to multiple financial institutions now doable over one connection, it saves time and resources. Which eventually trickle down to you in 30-minute transfers, and free 2-3 day transfers that were once deemed impossible.
So next time you send money to India and it gets there in 30 minutes, don’t be surprised to hear that grandma Abhaya is already teaching the Kalaripayattu class she enrolled in in the morning.