Digital Foreign Exchange
By Nasir Zubairi
F
oreign Exchange (FX) is a $4 trillion a day industry. Participants at all levels depend on technology to enable broad and efficient access to markets; whether they are driven by speculative trading, hedging of currency risk, a need for physical foreign cash or the need to make international payments. FX markets are extremely liquid, there is plentiful supply, there are many competitors vying to
deliver FX services, yet
currency exchange is still very expensive for all except the largest of corporates.
There has been considerable hype and rapid innovation in the “Money” industry over the past
few years,
specifically in the area of payments, with several key areas of focus: Mobile payments with the aim of providing wider consumer access for POS and remittances/transfers, e-wallets to enable efficiency in eCommerce and in mobile payments, Payment Service Providers delivering richer,
more
efficient and lower cost solutions for online merchants and e-currencies enabling effective and standardised
54 entrepreneurcountry
means of exchange within the digital world.
Distribution and access to currency services are unquestionably improving. Alternative payment providers seek to lower the direct transaction costs for making payments relative to legacy banking transfers. However, the direct fees for making or receiving payments across different currencies are only part of the overall economic cost to customers; the rate at which the currency is converted, the “spread” (the margin over the cost to the supplier
to acquire the currency) applied to the exchange rate can have a major impact on cash flow for businesses engaged in cross border trade.
It is interesting to look at the websites of
of conversion is rarely
online international payments facilitators; although the fee for making a transfer is usually plain for all to see, the commission earned on the rate
transparent to the potential customer. When comparing international transfer rates via a service aggregator such as
moneysupermarket.com, conversion
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60