Sending money internationally is commonplace today, but it wasn’t always so. The history of international money transfers is a fascinating epic, marked by successive innovations that have pushed back financial frontiers. These advances, driven by pioneering companies, illustrate how technology continues to redefine this field. In this article, we look at the evolution of international money transfers, from traditional methods to modern solutions.
I - The beginnings: old-style money transfers (19th century)
Before the advent of the Internet, the telegraph was the fastest way of transmitting information, including payment instructions. This system, based on sending coded messages called telegrams, enabled fast and reliable communication over long distances. Although it did not physically transfer money, the telegraph revolutionised financial transfers in the 19ᵉ century by acting as an instant messenger. Companies like Western Union quickly developed a global network of interconnected offices, allowing customers to send and receive money.
The process was simple but structured. The sender would visit an office, pay the amount to be transferred with a fee and provide the recipient’s details. The office would then transmit a coded message to the receiving office, authorising the payment. The beneficiary was informed and had to present an identity document to withdraw the funds. This system, although analogue, laid the foundations for a financially interconnected economy, heralding future innovations.
II - The emergence of modern banking (late 20th century)
The first digital money transfer companies paved the way for the technological revolution we are experiencing today. By harnessing the burgeoning power of computing and the Internet, they transformed the way money moves around the world. Here is an overview of the key players and their significant innovations:
1 – SWIFT: Standardising interbank transfers
Founded in 1973 in Brussels, the SWIFT (Society for Worldwide Interbank Financial Telecommunication) network was designed to overcome the limitations of the Telex system, then used by financial institutions. Considered unreliable and prone to errors, Telex offered long processing times. With the initial participation of 239 financial institutions from 15 countries, SWIFT introduced a secure electronic messaging network to replace paper-based transfers and Telex. In 1977, the network already included 518 institutions from 22 countries. Today, more than 11,000 institutions in over 200 countries use SWIFT.
– Innovation: Creation of a secure electronic network for financial institutions, enabling them to transfer funds quickly and reliably.
– Impact: Drastic reduction in errors and delays in cross-border transactions. SWIFT has become the standard for international transfers between banks.
2 – First Virtual Holdings: The first steps towards online payments
In 1994, First Virtual Holdings became one of the first companies to offer fully electronic payments via the Internet. Customers communicated their payment details by email, while the company processed the transaction and notified the merchant to ship the goods. Although First Virtual left the online payments sector in 1998 to focus on electronic messaging, its model marked the beginning of the transition to digital payments.
– Innovation: Introduction of electronic transfers via the Internet.
– Impact: Although limited by low Internet penetration at the time, First Virtual laid the foundations for modern online payments.
3 – PayPal: The democratisation of digital payments
Launched in 1998 under the name Confinity, PayPal rapidly evolved to become a global benchmark for online payments. After merging with X.com in 2000 and going public in 2002, the platform has transformed e-commerce by offering a practical alternative to cheques and bankcards.
– Innovation: An intuitive platform for linking bank accounts or credit cards to send and receive money with ease.
– Impact: PayPal has popularised online payments, facilitated e-commerce and stimulated growth in transactions between individuals.
III - Innovation in money transfers: TRANSFERGRATIS (21st century)
Today, applications like TRANSFERGRATIS are redefining international money transfers by placing innovation at the service of the African diaspora. Designed in 2022 to meet the specific needs of these communities, TRANSFERGRATIS offers an ideal solution for sending money from Canada to Africa.
With an intuitive interface and cutting-edge technology, the application guarantees a fast, secure, free and simple experience. With just a few clicks, you can make a bank deposit or mobile money transaction from the comfort of your own home. TRANSFERGRATIS stands out for its transparency, allowing users to send money without fear of hidden charges. This reliable, free service makes it easy to support loved ones abroad, while ensuring that they receive the maximum amount of money sent.
The evolution of international money transfers is a perfect illustration of how technology can transform an entire sector. From sending money by telegraph to instant transfers on applications like TRANSFERGRATIS, each step reflects progress towards greater simplicity, inclusion and efficiency. As technology continues to push the boundaries, international money transfers are no longer a constraint, but an opportunity to unite individuals and families, wherever they may be.
Stop letting distance be an obstacle and download TRANSFERGRATIS, the best money transfer application, today.
