Using banks or Western Union to transfer money to an account overseas is not the only game in town these days.
A number of remittance technology start-ups have sprung up in Singapore over the last few years, with the lowest-cost-operator charging as little as 0.25 per cent for cross-border payments.
Speak to any of the people behind these firms and you will find that their driving principles are the same - a disdain for hidden fees and a belief that customers deserve more transparency than banks and traditional money transfer agents claim to offer.
At most banks, customers swap their currency at a rate that has been marked up over the live exchange rate, which varies depending on the amount of money being transferred. Customers are also subject to a roughly $20 cable charge and a handling commission. On top of that, receiving banks can also charge their own fee on the transaction.
A new breed of start-ups is changing that landscape. A common feature on the websites of firms such as SingX, InstaRem and Transferwise is that they all feature simple-to-use calculators that show you exactly how much your transfer will cost, based on the live exchange rate you can see on Google.
SingX founder Atul Garg calls this a "fair exchange calculator". There is no foreign exchange mark-up at SingX, which charges a fixed 0.5 per cent handling fee, with no minimum transaction amount.
InstaRem chief executive Prajit Nanu says: "Transparency with the new-age digital players is very, very high. Everyone provides the mid-market rate - that means the wholesale rate at which banks transact."
InstaRem charges a fixed 0.25 per cent handling fee, which makes it the lowest-cost operator here, based on the World Bank's league tables. It achieved this by negotiating with banking partners to secure "preferred treatment", so its real costs are lower.
In other words, the model is a sustainable one. Mr Nanu says: "We're not undercutting the competition; 0.25 per cent is more or less the lowest base anyone can go in Singapore. So if you are sending $1,000, our cost to you is $2.50."
How exactly do these newcomers afford to keep their rates to a fraction of what the big boys charge?
The basic model used by most remittance start-ups is the same. London-based Transferwise, which is now valued at more than US$1 billion (S$1.35 billion), was the first mover in 2011. It has built a network of local bank accounts around the world that it uses to send money more cheaply and quickly than if it were to rely on the old Swift payment system used by banks.
So a customer in Singapore can make a FAST bank transfer to Transferwise's Singapore account for free.
Transferwise then goes to its Malaysian bank account where it already has funds and pushes a payment from that account to the recipient's account.
Transferwise launched in Singapore in July last year and set up an office here in September. It has a large global licensing footprint, so customers here can send money to 67 countries and receive transfers from 42 countries.
It charges a fixed fee plus a percentage for each transfer. This averages out to around 0.5 per cent across all currency routes with a minimum fee of $2.
Transferwise head of banking Lukas May says: "In the United Kingdom, we're up to eight times cheaper than the banks. Banks here are more competitive than in the UK, and I'd say we're up to three times cheaper."
The strategy for remittance start-ups is to scale quickly to drive down costs. Transferwise, which has over a million customers globally, has already reached enough scale to be operationally profitable, says Mr May. Transferwise has also passed on some of the savings to its customers, cutting its charges for Singapore transfers by about 20 per cent a month ago.
The local remittance scene may be humming with change, but what is striking is how friendly the start-ups are with each other. There was no sense of rivalry at a panel discussion last week attended by Mr Garg, Mr Nanu, Mr May as well as the founders of Chynge and Coinpip.
Mr Garg of SingX says: "The overseas payments market is a US$30 trillion opportunity. Really, all our competition is with the banks and the Western Unions and MoneyGrams of the world. We're taking away share from them."
Besides, remittance is not going to be a winner-take-all game, he adds: "Banks and fintechs will co-exist. There is room for more than one remittance company."
SingX went live at the end of January this year and now has almost 6,000 customers. InstaRem went live in February 2015 and has more than 50,000 customers, including small and medium-sized enterprises like hotel booking sites.
There is plenty of room for innovation. InstaRem's next project is to help reduce remittance costs even further for Work Pass and S Pass holders.
Mr Nanu says: "The real pain of remittance costs is felt by these guys. These are the guys queuing at Lucky Plaza to draw cash from ATMs."
These workers are still doing cash-to-cash transfers, so Mr Nanu plans to offer them the lowest fee across the market, but only if the payment is sent to someone's bank account. InstaRem plans to tie-up with banks to make account-opening easier for them too.
"We are hoping that it creates a whole cycle, so people who don't have a bank account will open a bank account," he says.