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How to find the best rate when sending money abroad

The Local spoke to the co-founders of Monito, a money transfer comparison site that helps you find the best exchange rate on international money transfers.

Published: 3 June 2019 05:00 CEST
How to find the best rate when sending money abroad

It was while studying in Hong Kong that Monito co-founder Laurent Oberholzer first noticed that there was room for improvement when it came to international money transfers.

“I distinctly remember that you would see long queues of people standing in line for hours to send money back home,” Oberholzer tells The Local. “There are a lot of workers from the Philippines in Hong Kong and they are making a big sacrifice to help their families. I would see them with these cardboard mats, which they would sit on, and they would be playing games to pass the time.”

Oberholzer, who is Swiss, also discovered first-hand the exorbitant fees that can be charged when receiving money abroad from his parents. He soon began to think that the entire money transfer process could be overhauled and improved.

Save money on international money transfers with Monito

Thousands of miles away in Cameroon, Swiss brothers François and Pascal Briod were having a similar light-bulb moment. The Briods first set up a non-profit organisation when they were youngsters to fund projects such as AIDs prevention workshops in Cameroon. However, despite their good work, they encountered high fees when transferring the funds they had raised to the African country. And their regular work visits to Cameroon were also an eye opener.

 

“You would see advertising for money transfers everywhere but there was a lack of transparency about it all. Africa has always had a reputation for high money transfer fees; the global average is 7 percent, while in Africa it is still 12 percent,” says François

Photo: Co-founders François, Laurent and Pascal

Inspired and motivated by their foreign sojourns, the trio converged in their native Switzerland with an ambitious goal to shake up the world of international money transfers.

“It started with an idea to try to save $28 billion in excess fees, which is quite a lot of money that can be saved!” says François.

$28 billion may sound like an eye-popping amount but that figure is based on data from the World Bank which in 2014 reported that a total of $582 billion was sent in remittances. Migrants paid an average of 7.9 percent on those transfers so Pascal, François and Laurent estimated that billions could be saved if people used cheaper money transfer services.

Together in 2013, the trio founded a price comparison money transfer website and christened it Monito — think Skyscanner but for money transfers. The business model is simple: users get to choose the best deal within a matter of seconds of entering their search request. Success has been forthcoming for the Swiss entrepreneurs with Monito scooping numerous start-up awards.

Sending money abroad? Compare all your options here

Got your ad blocker on? Turn it off to use the Monito widget below and find the best money transfer deal

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The trio say that moving and living abroad has been key to their foray into entrepreneurship.

“You broaden your perspective when you live in another country. You encounter different problems so you have to try and find creative ways to solve things,” says Laurent.

Those problems can include learning a new language, finding your way around, embracing a new culture, as well as sending and receiving money from back home.

“Living abroad has been fundamental to me becoming an entrepreneur,” says Laurent of his time in Hong-Kong. “Migrants in any country have a higher propensity to be entrepreneurial; you are forced to go outside your comfort zone. Living in a different country changes your preconceptions and has a huge impact on who we are.”

That being exposed to multiculturalism can boost your career is also backed up by science. A 2013 scientific article in the Social, Psychological and Personality Science journal stated that ‘multicultural engagement’ was paramount in predicting subsequent career success.

In the space of just six years, the founders of Monito have established strong relationships with money transfer operators as well as with their many returning customers. Their goal of saving consumers $28 billion in fees remains an ongoing motivator.

“Most people have no clue how much it costs to send or receive money. In some cases there are mind-boggling numbers of up to 25 percent because of all the hidden fees. We want to raise awareness in more markets,” says Laurent.

He continues, “We want to make things as transparent and simple as possible; banks don’t have a strong interest in transparency. We are trying to help people save money and have been met with a positive reaction.”

The Swiss trio preach perseverance and passion for other expats keen to pursue entrepreneurship.

“We never considered that six years later this is where we would be. You have to try and see what you can do. There is no secret. You need to put in the hours and keep pushing,” says Laurent.

His colleague François concurs, concluding: “Just do it!”

This article was produced by The Local Creative Studio and sponsored by Monito.

ECONOMY

Geneva watch show opens in throes of Swiss banking turmoil

The Geneva watch fair opened this week buoyed by booming growth in the watchmaking industry, but insiders warily eyed the banking sector turmoil, evoking painful memories of the 2008 financial crisis.

Published: 28 March 2023 09:28 CEST
Geneva watch show opens in throes of Swiss banking turmoil

Industry professionals were upbeat on the first day of the Watches and Wonders annual fair, where 48 prestigious brands including Rolex, Patek Philippe and Cartier were showing off their new creations.

The fair, which runs until Sunday with the weekend open to the public, kicked off after two years of record gains for Swiss watchmakers.

Exports soared by 31.2 percent in 2021, after a strong rebound in sales in the United States and the Middle East.

And the return of luxury tourism to Europe in 2022 after two years of Covid disruptions pushed exports up a further 11.4 percent to 24.8 billion Swiss francs ($27.1 billion).

The growth has also continued so far this year, with exports up by another 10.6 percent during the first two months of 2023, according to statistics from the Federation of the Swiss Watch Industry.

But optimism at the Geneva fair was somewhat dampened by the angst surrounding the turbulence currently lashing the banking sector.

Switzerland – whose vibrant banking scene is a key part of the country’s economy and culture – has been rocked to the core after the government strong-armed the nation’s biggest bank UBS into swallowing up its troubled competitor Credit Suisse, in a bid to ward off a larger global banking crisis.

READ ALSO: ‘A dark day’: How Switzerland reacted to shock UBS buyout of Credit Suisse

‘Global repercussions’

The upheaval has brought back difficult memories for Swiss watchmakers.

After the 2008 round of bank failures sparked a global financial crisis, Swiss watch exports plunged 22.3 percent in 2009 – more even than during Covid-dominated 2020.

“I am unable to say what the global repercussions will be,” Thierry Stern, the boss of Patek Philippe, told AFP.

“But I still think it should be easier than in 2008-2009.”

Participants are seen next to a giant watch by German manufacturer of luxury and prestige watches at the luxury watch fair in Geneva', on March 27, 2023 in Geneva.

Participants are seen next to a giant watch by German manufacturer of luxury and prestige watches at the luxury watch fair in Geneva’, on March 27, 2023 in Geneva. (Photo by Fabrice COFFRINI / AFP)

For the moment the difficulties remain “very localised” as Patek Philippe “sells all over the world”, said Stern, who is counting in particular on Asia to ensure growth in 2023.

Jerome Lambert, managing director of the luxury giant Richemont – owner of the Cartier, Piaget and IWC brands – acknowledged that the turnaround in
demand in 2009 had been “very rapid” and very “severe”.

“But it was a big lesson for us,” he said, explaining that the group had since taken distribution in hand.

Edouard Meylan, owner of the Hautlence brand, nevertheless believes that “lights are turning red”.

“If there is a financial crisis, it will have a very big impact on our sector,” he told AFP, especially since with supply difficulties some watchmakers have gone from “very large orders from their suppliers” and risk finding themselves with large stocks if the market turns.

Other analysts believe there is little reason to panic just yet.

“For now, I would expect the impact to be muted,” Jon Cox, an industry analyst with the Kepler Cheuvreux financial services company, told AFP, adding that he is still expecting to see growth this year of around 10 percent in exports.

READ ALSO: Swiss sweat over size of new superbank

Full steam ahead for China?

However, the Credit Suisse debacle, which threatens tens of thousands of jobs in the financial sector, could take its toll.

“The financial community is an important part of the buying public for the watch industry and there could be impact in local markets, such as Switzerland, on domestic business,” Cox warned, adding though that “this is likely to be offset by tourism”.

For now, Swiss watchmakers are looking to the Chinese market to pick up pace and ensure their 2023 export growth.

When demand was exploding in other markets as they rolled back pandemic protection measures, the watch market in China remained subdued as the country ploughed on with its zero-Covid rules, and then saw infection numbers explode when it abruptly ended that policy late last year.

But watchmakers and experts are expecting that to change with the reopening of the Chinese economy.

Jean-Philippe Bertschy, an analyst with Swiss investment managers Vontobel, warned however that “a return to normalcy” for Chinese watch sales – traditionally Swiss watchmakers’ largest market – will take time.

On the positive side, he told AFP he was confident, given “the level of savings the Chinese had set aside during the health restrictions”.

As for tourism, he cautioned that while Chinese travellers may quickly flock to Asian destinations, “it will take more time before they return to Europe,” due to the continued limited air transport capacity and visa backlogs.

By Nathalie OLOF-ORS

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