A currency conversion company called TransferWise is pioneering a new system aimed at cutting banks and the travel industry out of the foreign exchange market.
The service exchanges money at mid-market rates and only charges a £1 fee flat rate. If the concept takes off as its founder hope it could pose a challenge for travel companies with large revenues from currency exchanges.
Rather than using a bank to convert money, transferwise match up people trying to exchange money. They act as an intermediary between the two parties and hold the money while determining the exchange rate.
With a huge potential customer base feeding different currencies into a communal account, TransferWise hopes to be able handle transfers of all sizes. Currently, they are only accepting British pounds and Euros but the company hopes to expand very soon.
Although established in March last year the company started trading this month. Among the founder is Taavet Hinrikus who worked for Skype from its inception and helped set up TweetDeck.