The impact of competitive cross-border fees on customer acquisition

Offering effective cross-border fees is important for customer acquisition. A high cross-border fee can drive your customers to other providers, whereas lower fees attract a larger customer base. Customers look for affordable fees and transparency in a remittance service. 

As a remittance service provider, you must strike a balance between the pricing and profitability of your business. The right cross-border remittance solution will help you cut the additional costs associated with cross-border fees.

Want to know more about how competitive prices can impact customer acquisition? 

Well, this blog has got you covered.

This blog explains strategies for effective pricing of cross-border fees.

Let’s dive into it.

How cross-border fees influence customer acquisition

Every customer, before doing any transaction, checks the fees of the platform. Pricing your fee effectively attracts new customers to your services. 

Let's understand how cross-border fees can influence customer acquisition:

Increased customer attraction 

Your customers compare cross-border fees before making the transaction. High fees can drive them towards alternative options. Lowering fees makes your service more attractive, especially to migrants and merchants making frequent transactions.

Reduced customer acquisition costs

High fees make it difficult to attract new customers, which can further lead to higher marketing costs. In that case, it can be expensive to acquire new customers. Whereas lower fees will naturally bring in more customers to your platform, word-of-mouth and referrals would make wonders. Plus, they also reduce your marketing expenses.

Market expansion

Lower cross-border fees make international remittance services accessible to a wider audience. Customers often avoid formal banking channels due to high fees. You should take this as an opportunity by offering competitive fees. This way you encourage the customers to use your service instead of informal money transfer methods.

Impact on business profitability

Cost-efficient cross-border remittance software helps reduce operational expenses. Automation, AI-driven compliance checks, and real-time currency conversion optimize costs. Lower operational costs allow you to maintain competitive fees while ensuring profitability.

Strategies to leverage competitive cross-border fees for customer acquisition

Competitive cross-border fees can be a powerful tool for attracting and retaining customers. You can use various strategies to acquire customers by leveraging competitive cross-border fees. Here are the strategies you can use:

Transparency in cross-border fees

Your customers want to know the fees clearly and up front. Displaying the fees upfront to them establishes trust and enhances customer loyalty.

Targeted marketing

You can promote your competitive fees through targeted advertising and campaigns to attract price-sensitive customers. Highlighting affordability in advertisements can increase conversions for you.

Partnership with payment & rate providers 

You can partner with global payment providers to reduce transaction costs. Also, collaborating with the rate providers can allow you to offer more competitive cross-border fees to your customers. 

Price-based smart routing

Using price-based smart routing would help you to optimize transaction costs. This approach selects the most cost-efficient payment channels while ensuring customers get the best rates while maintaining profitability. Competitive fees combined with incentives enhance customer retention and attract new users.

Conclusion

Offering competitive cross-border fees increases customer acquisition and drives you towards market expansion. Plus, by offering the fees competitively lower than your rivals, you can establish yourself as a leading international remittance provider.

On the other hand, your customers prefer affordable and transparent services while using the cross-border remittance platform. That’s why lowering the fees and setting competitive cross-border fees would encourage repeated transactions and boost word-of-mouth marketing.

Selecting a robust cross-border remittance software will enable you to offer a competitive cross-border fee. This will also further make you a distinguished provider.