Banks vs. Fintech, Ten Years On: How Competition Reshaped FX & Cross-Border Payments

In 2015, small and medium-sized enterprises (SMEs) migrated to fintechs for international payments because banks were slow, opaque and expensive. Payment times were measured in days, fees were buried in exchange-rate markups, and payment tracking didn’t exist. That opacity was costly: Research we commissioned by payments consultancy Accourt in 2015 estimated that UK SMEs alone paid £4 billion in hidden FX fees that year, largely through rate markups rather than transparent charges.

A decade later, the landscape looks very different. Banks, prodded by regulation and pressured by fintech competition, have rebuilt much of the experience: clearer pricing, faster delivery, in-app tracking, and SME-friendly multi-currency accounts. This blog looks back at where we were in 2015, what’s changed, and how banks have responded.

2015: Banks offered a poor deal and had little incentive to improve

Opaque pricing & hidden markups: ‘Zero fee’ often concealed wide FX spreads that were hard to compare, leading to unreasonable costs for businesses.

Slow correspondent chains: Cross-border payments moved hop-by-hop with little end-to-end visibility. Banks’ own profits from payments were robust, but customer experience lagged.

Clunky User Experience (UX): Business customers got branch forms and legacy portals, while fintechs offered clean dashboards, tailored functionality, instant quotes, and upfront costs.

Regulators and industry bodies noticed. By 2018–2020, the policy tide had turned toward transparency in currency conversion and faster, trackable payments.

What’s Changed: The Big Drivers (2017-2025)

1. End-to-end tracking and faster settlement (SWIFT GPI & SWIFT Go)

Launched in 2017, SWIFT GPI introduced same-day payments, real-time tracking, and full fee transparency across the chain. Adoption has been broad and reasonably brisk. As at the time of writing, 82% of all SWIFT payments are sent via GPI, representing the equivalent of over $530 billion daily.

For low-value SME and consumer payments, SWIFT Go (2021) set expectations for predictable fees and delivery; more than 600 banks in 120 countries now support it, with most payments completing in minutes.

The benefit to SMEs is that, as with a parcel, you can now track an international payment with a UETR (Unique End-to-end Transaction Reference), see intermediary charges, and receive funds faster (often same day) directly from your banking/payments application.

2. Pricing transparency pushed by regulation

The EU’s 2019 Cross-Border Payments Regulation (CBPR2) mandated upfront disclosure of FX markups and robust post-transaction disclosure (rules transposed to the UK post-Brexit). This effectively outlawed the ‘hidden fee’ models that had long been the bread and butter of the banks and the less scrupulous FX brokers.

There is still work to do, however, and regulators continue to press for clarity. As part of its Consumer Duty regulation, the FCA has recently highlighted poor practice in disclosing total international payment costs, including FX markups and intermediary fees.

3. Bank-built SME products that looked (and felt) like fintech

The banks responded by launching fintech-type products, which experienced varying degrees of success. HSBC and Santander receive honourable mentions for their persistence in having a go at this, and in investing chunky sums as they built or bought their way into the competition:

• Santander One Pay FX (2018): used Ripple’s blockchain tech to offer same-day/next-day delivery and upfront amounts - an early signal that banks would invest in faster cross-border rails and cleaner UX. While worthy, it appears to have had modest expansion and has not become a major fintech challenger outside Santander’s own customer base.

• Santander PagoFX (2020): A standalone money-transfer app aimed at non-Santander customers, designed to compete directly with fintechs like Wise, with improved UX, transparent pricing, and real-time FX rates. Shut down in 2021 as Santander re-focused its digital-payments strategy toward B2B and internal products rather than this retail-open-market challenger.

• HSBC Global Wallet (2021): a multi-currency wallet for SMEs to hold, pay and receive in multiple currencies from one interface, rolled out in Singapore, the UK and the US. HSBC’s recent interim reports indicate that Global Wallet “continues to be rolled out to a wider market”.

• HSBC Zing (2022): an app to compete with fintechs targeting younger users with competitive FX, international payments and social features. Shut down in 2024 after a couple of years of operation, due to poor uptake, large losses and a shift in strategic focus.

What Hasn’t Changed (Enough)

• FX costs still vary materially across providers and corridors; banks continue to apply spreads that can exceed fintech benchmarks on some routes. (Comparison guides regularly show differences in effective rates/margins).

• Intermediary/recipient bank fees can still erode final amounts where local clearing access is limited—an area regulators flag as needing clearer disclosure.

• SME onboarding & service: despite big UX gains, many banks still struggle to match fintechs’ speed to onboard SMEs at scale, especially in niche or higher-risk segments.

What Does This Mean For SMEs?

• Don’t assume your bank is good enough - or that fintech is always better. Use like-for-like quotes, compare total landed cost (fee + FX rate vs. mid-market), and delivery time per corridor. CBPR2 disclosures finally make this practical.

• Exploit new bank rails with fintech UX. With GPI/SWIFT Go, banks should be able to deliver speed/traceability similar to fintechs. The winning formula for SMEs is a provider (bank or fintech) that pairs those rails with instant quotes, clear markups, and proactive exception handling (ideally with human customer support!).

• Choose the right account structure. If you invoice globally, multi-currency wallets/accounts can cut beneficiary fees and reduce double-conversion. Evaluate wallet coverage (which currencies you can receive and hold locally) before making a decision.

How Banks Caught Up - And Where Fintech Still Wins

Competition worked. The ‘fintech wedge’ of 2015 - transparency, price and UX - pushed banks to adopt payment tracking, disclose fees, spreads and markups, and offer SME-ready products (rather than just re-skins of personal banking products). Yet fintechs still tend to win on speed of product development, onboarding, and consistently lower spreads on mainstream corridors. For SMEs, the smart move is to be provider-agnostic: pick the partner (or mix of partners) that delivers the best landed cost, reliability and visibility for your actual routes and requirements - not just the one with the biggest logo.