“Banks have been doing international settlement much the same way since 1971,” says Richard, founder of Remitsy, in an interview for UK Investor Magazine.
Richard is a strong believer in the innovations in consumer payments, which are now more convenient than ever. But when he looks at business payments, he is a bit less positive. According to him, solutions from banks just aren’t up to scratch, where charging between 3 – 8 percent for international business payments is par of the course. In addition being expensive they are slow. It can take up to five working days for payments to arrive…five working days. There are also frequent cases when payments get “lost in the system” and you’re looking at a very complicated process to get it “unlost”.
It happens because banks are using old technology and run an expensive service:
“Banks have been doing international settlement much the same way since 1971 – and even where they have leveraged new technology to improve their products, as a user it often feels clumsily crowbarred into legacy systems.”
Business Payments are Changing
Recently there’s been a lot of news on banks such as Barclays and Bank of America (and others) experimenting with blockchain technology. But Richard thinks that the real innovation won’t be coming from the traditional banks:
“Whilst it is clear that banks now see the potential of the blockchain, I think we’ll continue to see the most cutting edge implementations coming from leaner fintech companies. That being said, banks are more than the sum of their technology, and Remitsy are not looking to replace the bank. But we have all heard that software is eating the world, and I see payments as the banks’ bread and butter. And we are hungry!”
You can read the whole article from UK Investor Magazine here.