According to the UK-based firm, remittance services – which offer a convenient method for transferring money between friends and families internationally – are becoming increasingly popular in the expat Asian, African and Eastern European populations in the UK.
However, Sudhesh Giriyan chief operating officer at Xpress Money said there is a huge variation in fees and customer rates between territories, which means some clients are being exploited and left at a disadvantage.
Giriyan pointed out that the average cost for sending remittances globally is around 7.6%, a figure he said is inflated by costs charged in sub-Saharan Africa which, in some cases, amount to as much as 20%.
Woefully short
This, he suggested, is in stark contrast to Xpress Money’s 2.09% global average cost: “We see no reason why any money transfer business should be in a position to charge more than [2.09%].”
“In 2009 the G8 set a target of reducing average charges to five percent. Six years on, we are woefully short of that target.” He said regulation on remittance is needed to stop the soaring transfer fees.
According to Xpress Money, the consumer market for remittance is worth £400bn (€544bn, $613m) globally.
More than £15bn in remittances are sent from the UK every year, with around two-thirds sent to developing countries.
Figures from the World Bank indicate that money sent to developing countries alone amounts to around £289bn.
Giriyan added: “Sums transferred are often relatively small and it is extraordinary that some businesses in our sector should be able to charge the fees that they do.”
