The British payments group became the first non-bank to hold an account in the BoE’s “Real Time Gross Settlement” system, allowing it to process payments into the UK without going through a commercial bank.
By having access to BOE’s payment systems, the company will be able to speed up its money transfers while reducing fees it charges customers, a strategy the company says, will be pursuing.
The Bank of England outlined its plans to widen access to its payment systems in the 2017 summer, and on Wednesday, 18 April 2018, governor Mark Carney said: “by stimulating competition and innovation, we anticipate increased diversity and risk-reducing payment technologies will reinforce financial stability while enhancing customer service.”
Craig Tillotson, chief executive of the Faster Payments Scheme that TransferWise will now gain direct access to, said the move allows fintech to compete with banks “on a level playing field”.
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