‎August 18

Setting up a Money Transfer Business in the UK?

Money Transfer Solutions | Setting up Remittance Business

Is Money Transfer Business profitable?

One word answer to this question is YES. But the regulations, licensing and actually setting up the business is challenging and need time duration of 6 months to 1 year.

UK Money Transfer Business

Every year approximately £15 to £20 billion is remitted out of the UK (source finder.com). And the amount has grown by more than 20% since 2010. London is remitting more than 60% of the total amount. Migrants and the UK citizens send money to outside world for various purposes. But the main purpose is “Supporting Family” back home. From business perspective, you need to consider various factors:

Country

Remittance to Nigeria and India are at top of the table. Combined remittance to these two countries is 30% followed by France, Pakistan (approximate 6% each) and Germany (approximate 5%). In London, many small remittance companies are setup based on the communities. For example, money transfer market for Sri Lanka is massive in some parts while in some other parts of London transfers to Sudan, Somalia and other African countries is famous. Being a business owner, it’s you who will analyse the market and select countries for your remittance business.

Competition

Money Transfer market is dominated by few online remittance companies. But there is always a gap which can be filled. Small business with physical and online presence tends to attract more customers by winning their trust. But the competition in exchange rates and transfer fees is fierce for some countries. Companies, time to time run competitions/promotions to offer zero fees or better rates. As a business owner,this will be key factor for your business to succeed. The most common and effective way to win customers is, researching local competitors and then offering your best rates and fees.

Compliance

KYC is the key. You need to know your customer before confirming the money transfer transaction. This is a golden rule in order to defeat money laundering. FCA and HMRC have taken preventive measures for money laundering. As a business there should be a process set in your company and staff/cashiers should be trained. Cashiers must be able to perform customer due diligence. Irrespective of the amount, as a business it will be your responsibility to register the customer by taking valid identification documents. And identification document can be passport, UK driving license or EU Nationality Card. And a proof of address that can be either utility bill or bank statement issued within last 3 months. Compliance can be key to your business success. Following FCA guidelines will help you keep your business away from unwanted nuisance.

Better Rates & fees and Customer Service

Now as you have decided the country, analysed the competition and set compliance procedures; it’s time to focus on real business. These are your profitable parameters, rates & fees as well as customer service. With increase in the usage of smart phones, customer these days will browse the mid-market rate, shop around different websites and then negotiate with you. If you are remitting to a small community where the competition is less then you can put up rates and fees to make profit. But if the competition is high like India or Pakistan then you have fix your rates and fees as per your online as well as local competitors. Customer these days are easily attracted to offers and promotions, but what matters most is customer service. When your customers get the feeling your staff recognises them then they will stay with you. For this make sure customer records can be fetched quickly, past transactions are viewed at a glance, customer is called by first name or appropriate way of addressing.

Money Transfer Solution software

This will be core of your business. You may have all your operational process set, but you will need a software solution which will help you in day to day transactions. Irrespective of having online presence or not you will need a system to store customer information, customer transactions, identification details, compliance checks, generating reports and other things. Calyx Solutions product Money Transfer Solution (MTS) offers you industries most robust, secure and easy to use software. This software is used by more than 25 businesses in UK with 100% satisfaction rate. You can find more information on https://moneytransfersolution.co.uk/ Pricing is very competitive and best part is service. Being a service oriented company the technical support is very quick and efficient. Please find the pricing at https://moneytransfersolution.co.uk/money-transfer-pricing

Sources

https://remittanceprices.worldbank.org/sites/default/files/migrants_remittances_uk.pdf
https://www.finder.com/uk/remittance-statistics

  •  Publish date: 19-8-2018
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