Nine years ago I stayed on Neil's couch in Wellington. Today we're working together on a fun project with a lot of potential. I would not have thought to ever become a banker, but that is what's happening now. Although it's not really "banker" in any of the classical conceptions, I'm now building a company around B2B money transfer.
When an exporter to Europe wants to receive money, they're currently not in a great position. Banks usually claim that they only charge a flat fee, often ranging from 5€ (if you're lucky) to 50€, for a transaction from e.g. Holland to India. What they don't tell you is how much they make on the currency spread. The difference between the ask and sell price is enormous, sometimes up to 6%.
Thanks to Nordea
That's where B2B Pay comes in. Neil and I started this in 2015, and now we're close to turning it into reality. Thanks to Nordea Bank in Finland, we're almost ready to launch a prototype: Exporters in India and Brazil will be able to get their own Finnish IBAN number, through which they can receive money for a vastly better fee than with any of the 100,000 banks in Europe. This is all possible because of virtual bank account technology.
And thanks to SEPA
This is all possible thanks to SEPA transactions. It's free or very cheap to transfer euros within 34 European countries. So the exporter can simply put their B2B Pay IBAN number on invoices and start receiving money. Directly after the money comes in to the B2B Pay account we send the money to the local bank account of the exporter. In the case of India for a 0.8% fee, from the mid-market rate.
It was good fun to be back in Finland after 7 years. At first I was sceptical about picking up Finnish, but after five weeks of trying to find some Swedish speakers to practice my Swedish I am converted, I will make more of an effort than yksi kaksi kolme.