Peer-to-peer foreign exchange company WeSwap has started lending holiday money to customers.
WeSwap Credit gives customers the option to borrow cash to spend abroad in the 18 currencies supported on the card.
It is interest free for the first 30 days and APR after then is “competitive” according to the company. It is unable to advertise a standard APR currently due to the low number of customers using the service.
“It [lending] is going to become a bigger part of our business,” said founder Jared Jesner. “We Swap Credit behaves like a credit card.”
The company hopes to launch a peer-to-peer lending service early next year, which would enable WeSwap users to make a profit by charging interest on money they lend to other users.
WeSwap’s move into lending is the latest development as the company looks to diversify its business. It recently launched a cash delivery service, which Jesner said was proving “very popular” among customers.
“The foreign exchange industry is split into cash, debit and credit and we now cover all three,” he told Travolution. “We’ve been evolving the product to appeal to different customers.”
WeSwap is currently looking for further investment and Jesner said he wanted to get travel companies on board. “We have financial investors already but we want to attract travel businesses to invest,” he said.
The company has previously used crowdfunding to raise cash, and its customers own around 10% of the business. Jesner said there was no planned crowdfunding round but said he imagines returning to the tactic in the future in order to offer new customers a chance to own a share of WeSwap.
He added that the company is developing a WeSwap for business travel, whereby companies can load money on to a WeSwap card for their employees to spend while away with work.
Jesner, who used to trade currency, also shared his views on recent exchange rates at airports dipping below one Euro to the Pound.
He said: “What you find in the airports is about 15% worse than the market rate, so I’d always advise holidaymakers to shop around for their currency. At WeSwap, we offer about 1% less than the market rate, so there are some big savings to be had.”
And despite recent doom and gloom about the value of sterling, Jesner said the pound was up against the Japanese Yen and Turkish Lira despite it being heavily down against the Euro and US Dollar.
In terms of Brexit, he said that neither a ‘hard’ nor ‘soft’ exit from the European Union would make a difference to the value of the pound, but that markets needed “certainty”.
“Both [types of Brexit deal] can be beneficial, but for the pound to strengthen you need certainty – which will keep the markets happy,” he added.
“When the pound is weak, you want to be much smarter with how you exchange.”