Original text here from Patrice Bernard (LinkedIn)
HSBC's first attempt to rival Wise in the international money transfer market just over three years ago was less than impressive. Now, the British financial giant is making a comeback with a completely redefined solution, backed by a robust communication campaign. The question is whether this new attempt is better equipped than its predecessor.
It's important to note the significant improvements made, although the new service, Zing, seems more like an evolution of the old "Global Money Account" (which is apparently still available) rather than a brand-new offering. In what seems like a counter-offensive, Zing is now open to all consumers (though currently only to UK residents), moving beyond serving just the existing bank clients.
A notable change is the creators finally grasping the key differentiator of their competitor. The service now offers total transparency in transfer fees, avoiding the common practice of traditional banks 'playing' with exchange rates. TechCrunch's tests suggest that the transaction costs are genuinely competitive. However, it remains to be seen if this trend is not just a result of an introductory promotion.
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However, HSBC misses the mark on another crucial feature of Wise: it continues to stubbornly refuse any commitment to transaction execution times. Compared to Wise's promise of funds arriving in less than 20 seconds in half the cases and consistently providing an estimated time, Zing's standard methods probably allow neither such prediction nor performance level, even if desired.
More troubling is the apparent retention of the prepaid wallet principle in this iteration, suggesting a transition from the previous system. Users looking to send money can only do so from their Zing account, supporting ten different currencies. If their balance is insufficient, they must first top it up before transferring. This detail, while seemingly minor, detracts from the experience of those looking to make occasional transfers.
In summary, twelve years after Wise's inception, which has reportedly captured a painful 5% market share from major global financial groups, these institutions still struggle to grasp the keys to Wise's success, let alone replicate them. As always, and as seen with Santander's short-lived PagoFX, HSBC relies on its reputation to cover its weaknesses. However, this strategy carries little weight in today's digital world.
