How rethinking travel money could help consumers spend and companies spend less

Mariam Sharp talks to a new startup that hopes to disrupt the travel money business

Unless they are in the super rich brigade most people don’t want to overspend on travel, nor do companies where staff travel extensively. Indeed, keeping travel expenses is a major issue for many firms, so the launch of a pre-paid MasterCard that offers 14 currencies on a single card at ‘spread free’ exchange rates could be the answer.

While many such cards already exist, recent research from MoneyComms finds that the average foreign exchange spread on both credit cards and debit cards is between 2 and 2.4%. For prepaid currency cards, the corresponding figure is around 2.59%.

As a traveller that’s what Brian Jamieson, one of the three founders of a new start up, Centtrip, wanted. He also wanted an account that focused on the individual rather than profits and was ‘transparent and fair’.

Until now, says Jamieson, frequent travellers have been able to shop around for the cheapest travel money but whether they like or not they have always had to pay some commission – otherwise known as margin, handling fees, and in financial circles ‘spread’.

According to Jamieson, the reason that nobody has done this yet, is that because for larger financial providers companies there wasn’t enough money in it and it would mean a significant change to how they have charged to date. While the profit margins may be small, Centtrip believes they can benefit from this high volume market.

At the same time, with more money in their pockets travellers will have more to spend during their trip, potentially giving a boost to ancillary revenues. With passenger numbers expected to reach 7.3bn by 2034, that could be significant.

What Centtrip aims to do is take away the ‘spread’ and by offering a single prepaid MasterCard that includes the following features:

  • An account can be prepaid/loaded by bank transfer in Sterling, Euro, and/or US Dollar by bank transfer
  • Funds can be converted into any of the 14 currencies as often as required, free of charge
  • Conversion at the actual live currency rates - no spreads, no markup, no commission 
  • No conversion charges
  • Accepted worldwide at over 34 million locations and 2.1 million ATMs displaying the MasterCard mark.
  • No point of sale charges and lower ATM charges worldwide

Centtrip earns a flat fee of 0.5% on the value of the money put into the MasterCard e-account and then travellers are free to convert it into 14 currencies at no charge. On currencies that aren’t yet available, however, the charge is 2%. Essentially, it’s a travel account with the ability to hold multiple currencies; travellers can move money on to the MasterCard when they want to spend and back into the account when they are no longer using the currency. 

In essence, not only does Centtrip provide solutions to travel consumers, it’s also a vehicle for firms to manage their travel expenses.

Why not join us for EyeforTravel’s start-up village in San Francisco (March 23-24) to find out if your big idea stacks up

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