Big Interview: Travelex remerges from cyber crisis to cash in on resilient forex market

Richard Wazacz, chief executive of the leading holiday money provider, says despite the move to a digital cashless society use of currency by people who travel internationally has not yet peaked

Cash is far from being dead when it comes to travel money, and may even not have reached peak usage, according to the chief executive of leading foreign exchange brand Travelex.

Richard Wazacz took the helm at Travelex in June 2022 two years after the firm entered administration following a serious ransomware cyberattack. 

The business re-emerged from the crisis thanks to a pre-pack deal which saw a group of creditors acquire the UK business slashing debts and saving many jobs although 1,300 were lost.

Following a brief period under turnaround specialist Donald Muir, the new Travelex business is rapidly emerging under the guidance of Wazacz, a fintech expert and entrepreneur.

Wazacz was delighted to be offered the role at such a well-known brand, the first he has worked for in a decade who he said his 80-year-old grandmother has heard of.

“There were two things that attracted me to the job. The first is cash is not dead. International travel money is nowhere near being dead. If anything it’s not peaked.

“For most people around the world their preferred form of payment when they travel is cash. They see it as the most reliable means of payment when they buy things when abroad. 

“In emerging markets the pace at which people travel is growing as the emerging middle class travel more, and they are using cash. 

“And in developed markets although cash use is slowly declining domestically the amount people are travelling is also still growing. 

“The other reason I took the job is brand and the distribution. The Travelex brand is amazing, it’s a recognised and trusted brand. In financial services that’s like gold.

“A lot of people see Travelex as a brand where they can get advice. People instantly know that’s the place they get their money when they see the red and blue logo.

“Having worked in fintech and start-ups I know you can have the best product in the world but if no one has heard of you it’s very hard.”

Competition from digital challengers 

Wazacz says there are plenty of examples from markets around the world in which the move to a cashless society is happening but not when people travel overseas.

He said rules and regulations, different payments methods, fear of fraud or having cards blocked by banks, and cultures mean cash remains the preferred choice of payment.

Travelex is operating in an increasingly competitive digital landscape with challenger banks like Revolut or Wise offering borderless international access to money.

However, Wazacz says these brands are appealing only to the 20% of the market that is digital savvy and organised and who value price over convenience.

“You have to recognise that people behave in different ways. Anyone who tries to devise a proposition that targets everybody will fail. 

“We are targeting people who are travelling. We support supermarkets and retailers with their proposition and with our branded stores we target people for whom convenience is the most important thing.

“The majority of people, definitely in the UK, are still financially nervous. Fifty percent of British people don’t like looking at their current account regularly because they don’t want to see they are overdrawn.

“There is a lack of understanding of financial services, it’s still a very complicated area. A lot of people are comfortable doing internet banking on their home computer but not on their phone. 

“Managing your money is a much bigger emotional decision than using an app to order an Uber.”

Interacting with customers on their terms

Wazacz says Travelex is building digital services for the 80% of people who are not yet comfortable using technology to manage their finances.

And he said the brand also offers customer advice about how to get the best value from their holiday cash, something that is not as transparent with traditional high street bank accounts that promote forex services.

Many holidaymakers will associate Travelex with the booths just outside airport security that benefit from people who have left their foreign exchange to the last minute.

Although highly lucrative for Travelex, Wazacz is “very comfortable” if people choose to be better prepared and opt for its pre-paid card which offers better value for users. 

He says this is a “high-touch” service backed by a 24-hour call centre that provides advice on how to top up their cards and link them to their app. 

“This and other services and advice about spending abroad, like ATM charges and paying in the local or home currency when given a choice, is what he believes sets Travelex apart.

“The focus for our digital proposition is all about letting consumers interact with us on their terms when and where and how they want to. We are not a pure tech play. 

“Our colleagues in our store are our biggest asset. We want to support them in the best way possible. You can order in a supermarket and collect at the airport. 

“And we let you come to the airport and we will advise you how much money you need and in what denominations depending on where you are travelling. 

“Pre-paid cards give you the security that travellers cheques used to. And if you don’t use all the money you can use it on your next trip. 

“A lot of people like to budget more sensibly and keep their holiday money separate. We are going to promote cards much more going forward.”

Working with partners to offer peace of mind

Late last year the Travelex launched the retail foreign exchange industry’s first ATM click and collect service in the UK and Australia. 

Another area that is expected to grow is third party distribution both in terms of offline retail partners like supermarkets and online OTAs and travel retailers looking for an additional revenue stream. 

Built specifically for OTAs with UK-based Fintech HedgeFlows, Travelex has developed a service that allows customer to fix the foreign exchange rate at the point of booking for up to 12 months. 

If the rate subsequently improves by the departure date the consumer can switch to that. A pilot is currently underway ahead of a full roll out.

Wazacz said partnering on this service will help OTAs to offer their customer peace of mind during the cost-of-living crisis but does require some IT development from the agent side. 

“The challenge with OTAs is they all have tech roadmaps which are well planned in advance so it’s all about getting on to their roadmap and doing a pilot,” he said.

Wazacz joined Travelex after the legacy of the cyber attack crisis that nearly brought the brand down had been dealt with and says it has “left all that behind”. 

In the end no customer data was lost but the experience for the brand was chastening and Wazacz says that a firm so embroiled in the world of finance can be successfully attacked goes to show the scale and sophistication of the threat all businesses face. 

“We take our cyber security incredibly seriously. We regularly benchmark ourselves against the industry and our cyber security is much more advanced. 

“Since I have joined we have maintained our focus on developing our cyber security status and requirements and we continue to invest to make it more robust.

“These criminals are continually attacking companies all around the world. It’s become a much more sophisticated industry. 

“Because Travelex was hit in the past we take the threat very seriously.”