The Impact of Mobile Apps on International Money Transfers

The Impact of Mobile Apps on International Money Transfers

Since the pandemic and the subsequent rise of remote work, it has become more critical than ever to have reliable and easy ways to transfer money internationally.

According to the World Bank, the sum of money sent home by economic migrants was close to $800 billion in 2022. This money was disproportionately sent to low- and middle-income countries and made a real difference to their economies, often outstripping official aid and development funding from the international community.

The advent of mobile apps for international money transfers has brought about a paradigm shift in how money moves across borders. Mobile money transfer apps are more than just tools for sending money—they are catalysts for economic empowerment and global connectivity, demonstrating the profound impact of technology on financial systems worldwide.

Transformation of Money Transfers

There have been many systems for transferring money, some dating back to the 8th century, such as the Hawala system in South Asia. This system spread slowly through Africa and the Middle East and is still used today. It is a trust-based system that uses networks of family and friends known as “Hawala Dealers” to send and receive money.

Western Union was founded in 1851 and pioneered sending money via telegraph in 1871. Almost 50 years later, in 1918, the US Federal Reserve Bank adopted this method.

In 1950, the Diners Club launched the world’s first credit card, allowing people to transfer money without using physical cash. Being able to pay for physical goods and services in this way revolutionized money transfers.

SWIFT was formed in 1973 and quickly became a secure way for financial institutions to send money internationally.

The birth of the internet was the next major challenge to the established order, with web-based services such as PayPal offering international person-to-person money transfers in 1999.

International Wire Transfers

The traditional way of sending money internationally between financial institutions is wire transfers. While these can be more secure, as you need to provide details such as recipient name, account number, and SWIFT code, fees can also be attached, making wire transfers less attractive. They can also take anywhere between one and five days once they have been initiated, which seems incredibly slow by today’s standards.

The Role of Modern International Money Transfer Solutions

There has never been such a demand for international money transfers. This is partly because businesses are expanding their global reach and partly due to the increasing fluidity of where people can work.

In the post-pandemic world, countless people have discovered that their options for where to work from are much broader than previously imagined. Work from home has become “work from anywhere” for many, which is a significant driver of cross-border payments. Being able to send payments home to family is a considerable concern for many, and they must be sure they can do this easily.

International businesses have increased potential solutions for safely and reliably transferring money to other countries. The modern solutions available also allow them to do this inexpensively.

If an international business had wanted to transfer money to Senegal in the past, it might have had to pay expensive fees and wait several days for the transaction to complete. Now, it can be done almost instantly.

Mobile International Money Transfers

Transferring money via mobile phone apps to family, friends, and businesses internationally has fundamentally changed how people choose to send money. The convenience offered by mobile phone apps linked to credit cards and bank accounts has enabled transactions at increasing volumes and speeds. What once would have taken several days can now take minutes, or even seconds, with instant notifications of successful transactions.

Benefits of Instant International Transactions

Money transfer apps may now be the best way to send money internationally. Apps leverage the power of smartphones and the internet, enabling users to send and receive money from virtually anywhere in the world with just a few taps. They offer:

1. Unparalleled Convenience

  • 24/7 Access: Mobile money transfer apps allow users to send money at any time of the day, without the need to visit a physical location or wait for business hours.
  • User-Friendly Interfaces: These apps guide users through the process step-by-step, making international transfers accessible even to those with minimal tech knowledge.
  • Instant Notifications: Both the sender and recipient receive instant notifications, providing real-time updates on the transaction status.

2. Speed and Efficiency

  • Instant Transfers: Some apps offer instant or same-day transfers, which reduces the time it takes for money to reach the recipient compared to traditional methods.
  • Real-Time Currency Conversion: Apps offer real-time exchange rates and transparent fees, ensuring users get the best possible rate and know exactly how much will be received.

3. Cost-Effectiveness

  • Lower Fees: Mobile apps typically charge lower fees than traditional banks and wire transfer services. Some apps even offer free transfers within certain regions or up to a specific limit.
  • Transparent Pricing: Unlike traditional services that often have hidden charges, mobile apps provide upfront information on fees and exchange rates, helping users make informed decisions.

4. Enhanced Security

  • Advanced Encryption: Mobile apps make transfers secure through multi-factor authentication and encryption.
  • Regulatory Compliance: Many of these apps comply with stringent financial regulations and anti-money laundering laws, providing an added layer of security and trust.

What to Consider when Choosing an International Money Transfer Service

Myriad international money transfer services are available, and looking at all the different options can be confusing. Some of the important considerations are:

1. Do they have a significant user base in your target country?

This can help if you are trying to establish business links with a specific country and want to pay using a particular service.

2. How many users do they have worldwide?

This can help provide a picture of how well-trusted they are and whether they are as legitimate as they first appear.

3. How long have they been involved in international money transfers?

This denotes their pedigree and level of experience in offering the service you are looking for.

4. How do their users rate them?

The experiences of others can help to guide you when choosing which service to use.

5. Are the fees competitive?

Ensure you aren’t paying too much to transfer your money to the target country. The World Bank reports that the average cost of sending money internationally is a little over 6%.


International money transfers have become much easier and more frequent in recent years. The increased competition from internet-based companies has forced fees downward, benefiting people all over the world.

It is now common to send money via phone apps to family and friends, as well as pay for goods and services. Many people use these methods to send money back to their home country, and this effect has been transformational worldwide.

By offering unprecedented convenience, speed, and affordability, these apps have not only enhanced the user experience but also contributed to greater financial inclusion and economic growth. As technology continues to evolve and more people gain access to digital financial services, international money transfers look set for continued growth.

Editor at Play Louder !

Kristin McCasey is a partner and editor atPlay Louder!She is a former award-winning film editor turned work-at-home-mom blogger. Three years after their son was born, she and her husband left their Los Angeles careers to have more time as a family. She now works with her husband, Joe, on their finance blog, teaching others how to achieve financial independence.