It’s not what you spend, it’s how you spend: The age of FinTech saves you money!

There is a stark viewpoint among a large number of people in mainland Europe, North America and the United Kingdom who have, for the last few years, in which cutting back costs has been central due to constant mentions of a cost-of-living crisis and rising everyday costs, which is inescapable to anyone who reads the media or watches any televised news.

Of course, as with all media which garners a large audience, there is a degree of sensationalism in many reports, but the underlying and important matter of how people will afford to maintain a status quo in today’s uncertain world of political overreach and the post-lockdown deficit is one of the key matters in everyday life.

On 15^th June this year, analysts in London predicted that the payments on a £300,000 mortgage would increase by £13,200 by the end of 2023 compared with 18 months ago.

That is quite a figure. This is not a surprise to many, as the majority of people have become accustomed to living with inflation rates of over 10% across mainland Europe and the United Kingdom for almost two years now.

Whilst monetary policy is central, and UK Chancellor Jeremy Hunt continues to view interest rate rises as the solution to an inflationary economy, saving money and tightening the belt has become an expert skill.

Interestingly, despite the high cost of essential items these days, many payment processing companies have noted that the amount of spending in terms of number of transactions and amount spent by consumers is relatively similar to the pre-lockdown statistics.

Recently, Cameron Bready, CEO of Global Payments, which is a multinational provider of payment processing services, said in an interview that his company had made large-scale acquisitions, so robust is the payments industry.

In the same interview, Mr. Bready stated that the business-to-business (B2B) sector is the next frontier for payments, especially digitising business payments. He considers that businesses are looking to digitise payments for wholesale goods and services, and whilst this is a highly fragmented sector, it is between three to four times larger than the consumer market.

What does that mean?

This means alongside the high costs that encumber many people, reducing the cost of making payments and the time taken to make transactions is now vital.

A hidden factor that is often not considered is the actual amount it costs to buy something and not just the cost of the item itself.

Paying bills or buying everyday items can sometimes result in high charges depending on how they are purchased.

If Mr Bready’s prediction bears fruit and more companies switch to digital payments, there will be an even more global marketplace in which consumers will buy most of their products and services online from a plethora of providers all over the world.

It has become habitual to focus on the actual cost of the item or service, but an extra consideration is the possible cost of making the transaction to buy the item or service.

For example, on many globally accessible sites, an item may be €10, but to a resident of the United Kingdom, there would be foreign exchange transfer costs, bank charges and even additional postage costs associated with this purchase.

Often, banks provide a less than favourable foreign exchange rate, and this, with any charge for making an ‘international’ transaction, could negate any possible advantage of buying a product at what seems a competitive price.

Therefore, it is important to consider whether to use a traditional bank with its priority toward domestic purchasing for domestic customers only or whether the modern world of digital financial services and online global markets would be better approached by using a FinTech company that understands this dynamic, and whose product was built with this in mind from the ground up.

Monevium’s IBAN account offers accounts to customers in the United Kingdom denominated in Euros and therefore opens a wide range of opportunities for making purchases via the ever-expanding commercial world of online and digital payments in Euros, therefore avoiding any foreign exchange costs.

Additionally, Monevium is a financial technology company rather than a bank, therefore does not engage in market making, thus a foreign exchange rate would not be determined by Monevium in the way it is with Tier 1 banks, making for a more customer-focused method of exchanging Euros for Pounds and vice versa within the app itself, should that be necessary.

When buying in Euros or sending funds in Euros, this can be done directly with the Euro as the original currency, avoiding bank charges and exchange rate-related loss when making transactions online.

Nowadays, everything from used products on eBay to high-value classic vehicles is available in Euros from suppliers in mainland Europe and accessible to British buyers via marketplaces or directly from suppliers’ websites. Fancy a holiday in Europe and want to reserve the accommodation directly? Watch those extra costs!

Given the continued momentum of consumption in a world of increasingly high everyday costs, it is vital to look at the actual cost after fees have been paid rather than focusing on the price of the product or service itself.

As the whole world moves toward a greater momentum of online purchasing, keeping an eye on the actual cost of these transactions could well be a very important method of saving money.

Monevium Ltd is a company registered in the UK under company number 10251711 and is authorised by the UK’s Financial Conduct Authority under Firm Reference Number 766038.