Money transfers between Singapore and India can now be done at a fraction of the cost that customers typically pay for overseas money transfers.
Local fintech start-up SingX has launched an online remittance platform that charges consumers a transaction fee of 0.5 per cent of the amount to be transferred, compared with up to 8 per cent levied elsewhere.
Those pricey charges are often not fully transparent to customers, and include cable fees, bank commissions and markups on exchange rates, said SingX, whose remittance service is licensed under its sister company, Transfer Easy, by the Monetary Authority of Singapore.
For example, a transfer of $1,000 from a bank account in Singapore to a bank account in India could cost $76 to convert the money to 47,500 rupees, based on Wednesday's data from Reuters. But that transfer would incur just $5 in transaction charges using SingX's platform.
Once a customer has registered for an account on the SingX website, he can initiate a transfer to India by transferring the amount from his own account into SingX's account. The recipient in India will receive the money within hours.
The Singapore to India service began last month, and SingX plans to expand its platform to allow transfers from Singapore to Malaysia, Hong Kong and Australia in the next few months.
"SingX wants to create the Airbnb of global payments with Singapore's first peer-to-peer foreign exchange platform," said company founder and chief executive Atul Garg.
"Cross border payments is a space which is ripe for disruption as currently consumers and SMEs end up paying too much in remittance charges to existing providers.
"We are targeting consumers and small and medium-sized enterprises - the segments we believe are underserved and are paying the highest rates for remittances. They will no longer need to queue up at bank branches or fill up forms," he added.
Mr Garg has more than 25 years of banking and payments experience with American Express and Bank of America. He was Amex's group general manager responsible for managing the firm's payment franchises in South Korea, India and several emerging markets.
Among SingX's shareholders are some of the region's most experienced bankers, including former DBS managing director Rajan Raju, who is also an adviser. Mr Edwin Khoo, who is also a former DBS managing director, is also an adviser.