While you may have been trading internationally for many years, it may be time to review some elements of your strategy, not least how you manage your international finances.
Why? The ubiquity of technology across virtually all sectors – including finance, where a new generation of providers are dubbed ‘FinTech’ – has dramatically simplified what were once complex and cumbersome processes.
FinTech has overseen a roots-up reconstruction of service offerings such as lending, payments and currency exchange, services which have traditionally been dominated by large institutions.
Because market incumbents are failing to keep up with innovation, they are quite simply no longer offering a fair deal. They need the extra margins from their traditional offerings to cover their inefficiencies – at the expense of the customer.
By using technology to facilitate these services, for example via peer-to-peer (P2P) models, FinTech companies can eliminate costly overheads and pass the savings on to the customer. P2P enables multiple parties to conduct transactions directly, rather than involving an intermediary.
Within currency exchange this model is pivotal, enabling companies to provide a matchmaking service rather than a banking service. freemarketFX employs the P2P model to create a marketplace in which both individuals and businesses can aggregate their currency requirements.
The offering is underpinned by appropriate use of traditional banking services such as escrow accounts to assure an appropriate level of security and governance. The result is a lean, efficient service that reduces the overall cost of exchanging currency, as well as time spent conducting such transactions.
While making foreign payments quicker and cheaper is beneficial in its own right, the knock-on benefits go beyond saving money and time, and into the heart of how you conduct your business.
You can be more flexible in terms of where you keep and how quickly you can move your money. This translates into more flexibility about where you put your staff, how you use subcontractors, whether you open local offices and how you fit with local business models and priorities.
Overall this means that costs of entry are lowered, potentially opening the door to new markets and reducing the risk of new business opportunities.
Whether you are considering expanding your business internationally, or looking for a quick and efficient way to pay merchants abroad, taking the time to understand new systems and technologies could lead to a solution that sees you reducing cost and driving profitability.
If you’d like to know more or speak to one of our consultants, please get in touch.