Cost is a driving factor that customers elect to use alternative financial services

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  • Banks and other financial providers sign up with Motive Partners to create digital financial services of the future

  • Open banking offers customers an easier framework in which to manage their financial services and find better priced options

  • Customers who make international money transfers with an alternative money transfer provider make big cost savings

Royal Bank of Scotland joins a range of financial companies including AIB, Banco Brandesco and Mastercard who have chosen to signing up to Motive Partners new service: Motive Labs. The partnership will enable banks to tap into Motive Labs research and development capabilities and technological developments, in a move that aims to propel them to the forefront of technological developments, ahead of the many challenger fintech firms. The partnerships will enable these traditional financial services providers to make advances that will see them deliver more innovative services, better rewards and faster services for their customers as well as adapt to changing regulatory requirements.

Many customers are option for alternative financial service providers such as robo-advisory services, digital platforms that invest your spare change, or money transfer firms when sending money abroad. However, customers are not just seeking out alternative financial providers for their digital platforms and quirky emoji-laden apps. The most savvy consumers elect to use alternative financial providers because of the cost savings on offer and the flexibility in their services.

When it comes to international money transfers, shrewd investors will partner with a money transfer provider because they can make big savings on regular transfers, or large one-off payments. Banks will charge transfer fees from £5 to over £30 depending on the bank and where you are sending your money to. They will also offer an exchange rate that is 4% over the interbank rate. By comparison, international money transfer providers will offer a rate between 0.5% to 1.5% over the interbank rate. On top of this, many offer fee-free transactions, while others charge very low fees.

With the advent of open banking, customers will be able to manage all of their financial affairs from one banking platform of their choice, meaning that there is no reason to stick with one financial provider to manage your money domestically and abroad.

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