In “Let’s Kill Every Remittance Service at Lucky Plaza” news, DBS and VISA are tag-teaming to handle cash transfers with Visa Personal Payments (VPP). Remittance services’ biggest enemy, PayPal, has flown the coop. They’re out of this country, maybe never to come back. But before the remittance people have even reached the “c” in “Let’s pop champagne,” DBS and VISA have arrived to take PayPal’s place:
PayPal and Personal Payments
Personal payments (transferring money to and fro) is a bit of a headache. It’s no problem locally. But if you need to send a few thousand dollars to say, Scotland, it gets complicated. There are administrative transfer fees, exchange rate issues, and worries about how long it takes.
So along came professional remittance services: They send your money anywhere, for a small fee (Which I suspect they’d take out of the envelope anyway, so they just formalized it). If you want to see a remittance service, just drop by Lucky Plaza. It’s full of foreign workers sending money abroad; like a departure terminal for wallets.
The next step up was PayPal. Apart from being a payment portal, PayPal also set up a service for personal payments. But because it’s online and cuts out the middle man, it tends to be cheaper than remittance services.
But in February this year, PayPal stopped personal payment services in Singapore. This was due to issues about “complying with all applicable laws and regulations in every jurisdiction that we do business in”.
What do we do now? Risk sending cash by mail? Fork over the remittance fees? Seriously raise the demand for carrier pigeons in pet shops?
DBS and VISA have the answer:
Visa Personal Payments
The VPP scheme allows you to transfer money, from your DBS / POSB bank account to anyone with a Visa card.
VPP already runs in over 20 countries, and DBS / POSB clients can now transfer money to around 1 billion VISA cardholders worldwide. Transfers currently happen in real time for the more popular countries such as the UK, India and Philippines, so the recipients get the money instantly. All you need are the recipient’s 16 digit credit card number, and their name.
Charges and Transfer Methods
VPP has an introductory fee of $2.50 – $5.00 when transferring money and the charges after the promotional period is up go to about $10 max per transaction (depending on country). As a comparison, Western Union charges at least $20 per transaction (not to mention you have to go down to a physical branch). The service allows a daily transfer limit of $2,500, which can be utilised over multiple transactions.
We have no precise numbers on how the foreign exchange rate will be figured, but it’s promised to be competitive. Once it’s possible, we’ll do a quick comparison between VPP, remittance services, and standard bank transfers. Follow us on Facebook for that.
- If the transfer goes to a VISA debit card, the money goes into to the deposit linked to the debit card.
- If the transfer goes to a VISA prepaid card, the money tops-up the balance on the prepaid card.
- If the transfer goes to a VISA credit card, the money pays the credit bill, with any surplus being reflected as stored credit.
As with PayPal, the fund transfer is highly secure. There’s also added convenience, in that you can do it via DBS’s online/mobile banking platform.
Would you use VPP to remit money? Comment and tell us why!
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Tags: Credit Cards