The World Bank reported that Australia ranked #3 among G20 countries in terms of how expensive it is for Forex transfers. In the five years between 2012 – 2016, TransferWise research concluded that Australians spent a staggering $14.7 billion on Forex fees alone. The co-founder of TransferWise, Taavet Hinrikus has been relentless in his criticism of Australia's leading banks, accusing them of fleecing Aussies with excessive charges and poor service. In an interview with the Australian Financial Review, Hinrikus highlighted the unfair banking practices in Australia, and other countries vis-a-vis forex transaction fees and commissions.

The TransferWise co-founder has essentially accused banks of cheating customers by charging excessive rates on Forex transactions. As the first employee of Skype, Hinrikus understood the complexities of changing money from one currency to another and the fees associated with these transactions. Not only do banks profit off the spread, they also take time to process the transfer. The concept of TransferWise gained momentum when the cofounders conducted their forex transactions between themselves at local banks, rather than sending money internationally through forex transfers. Within no time at all, TransferWise grew to a billion-dollar industry with a successful business model operating across Europe, the United Kingdom, and Australia.

TransferWise dropped anchor in Australia several years ago, and has quickly become the best currency transfer option in the land down under. The company is expanding rapidly, attracting business clients at a steady clip. TransferWise is successful because it does what banks failed to do: save customers money on Forex transfers. TransferWise provides clients with local bank accounts in different countries, allowing them to skirt high forex fees, commissions, and charges. Already, major software modifications are in place such as API structures allowing banks to use TransferWise over their own FX services, and multiple European banks are signing up with TransferWise to provide cost-effective forex transfers to clients.

By 2018, TransferWise concluded $6 billion worth of transactions in Australia, from $3 billion in 2017. The founders of this company are hoping that it will capture an increasingly bigger share of the Australian market, in much the same way as it did in the United Kingdom. The current projected goal for Australia is 15% market share of all online money transfers, and already great strides have been made. In the land down under, the ACCC (Australia Competition Commission) has been working hard behind the scenes to provide greater transparency in exchange-rate markups. This is helping users to understand how global money transfers are priced. Unfortunately, Australian banking services tend to hide the markup, leading to an enquiry into foreign exchange rates.

TransferWise has set an ambitious objective of greatly reducing forex fees for global money transfers. As more people sign up for the service, it can afford to reduce its fees and commissions, as evidenced by the price cuts in Q1 and Q2 of 2018. By Q4 2018, TransferWise had increased its volumes yet again, and the rate cuts will be evident later in 2019. Customers in Australia using the POLi payment method will now be paying a higher fee (AU$1). TransferWise is a big proponent of transparency, as evidenced by the price comparison tools with other forex services such as Xoom, Rabobank, Barclays Bank, and ING.

TransferWise having a big impact on money transfer companies in Australia

The runaway success of TransferWise in Australia has facilitated the growth of the online money transfer service industry in the country. Operators have taken a leaf from TransferWise's playbook and are now positioning themselves to go head-to-head against the big banks as low-cost money transfer operators. According to IBIS World, market research into the money transfer industry in Australia indicates that revenue will grow at an annualised rate of 5.3% through 2019, reaching $315.8 million in profits. Industry revenues are also on the uptick, with 4.1% growth expected this year. There are currently an estimated 1422 people employed in money transfer agencies in Australia, with 206 operational businesses.

The money transfer industry in Australia is characterised by multiple opportunities, including increasing globalisation and labour mobility, the advent of e-commerce operations which are lowering costs and fast-tracking online transfers. On the flipside, the global money transfer industry will likely experience slower-paced growth through 2024. The major hubs of commercial activity in Australia include Queensland, Victoria, and New South Wales which account for 85% of the industry. Australians tend to pick money transfer companies based on several factors, notably credibility and reputation, innovative technology and proximity to key markets. The money transfer agencies industry specifically excludes card-based services and bank wire services. Most of the activities are online money transfer operations, with several in-store money transfer operations. This nascent money transfer industry is set to grow rapidly in coming years, particularly as Australians grow wary of high bank fees and hidden charges.