ClearBank, the cloud-based clearing bank, today revealed that the fintech industry has seen a surge in demand for multi-currency and FX services. With the post-pandemic spike in e-commerce, cryptocurrency use, and remittances, nearly half of fintechs (49%) now offer multi-currency and FX services, and 94% of fintechs declared a multi-currency offering as “business-critical”, according to ClearBank’s study, ‘Muddled multi-currency: how do fintechs overcome cross-border complexity?’.
Fintechs and other financial institutions have traditionally faced too many barriers to entry when it comes to offering multi-currency capabilities, with high initial costs and transaction fees being the most impactful.
Key statistics from the study include:
Cost and profitability – Of the fintechs surveyed,87% said it is either ‘quite or very expensive’ to run their current multi-currency offering. A further 32% of respondents said they also encountered hidden costs when dealing with their current provider, and 28% said their profit margin has decreased in the last three years.
Market monopoly– Offering multi-currency and FX services is integral to remain competitive, but over a third of fintech executives surveyed (35%) reported waiting up to nine months for implementation.
Partners not providers – As a result, 79% of fintechs are planning to switch their multi-currency partner. 94% of fintechs declared a multi-currency offering as business-critical, and they’re turning to partners who can offer increased flexibility, improved technology, and an aligned aim to meet customer needs.
“The challenges within multi-currency for fintechs are many, but far from insurmountable,” stated Charles McManus, CEO of ClearBank.
“We invested in this research to learn how prepared UK fintech is for the global marketplace and where the gaps are, so they might become more competitive”.