TransferWise Ltd., the London-based startup backed by investors including Peter Thiel’s Valar Ventures and Andreessen Horowitz, is bringing its international money transfer service to Singapore, aiming to shake up banks’ dominance of the market.

By using TransferWise, consumers in Singapore will be able to send money overseas at a cheaper cost than using banks because it offers better exchange rates, according to co-founder Taavet Hinrikus. The company’s fees range from 0.5 percent to 1 percent and it will work with DBS Group Holdings Ltd. to access local payment networks.

TransferWise, which transfers $1.2 billion for customers every month, is the latest contender in a race to reshape the cross-border market in Singapore. Vertex Ventures-backed Instarem and MatchMove Pay, backed by Vickers Venture Partners, have joined a wave of financial technology startups that say they can offer better remittance services.

More than a million customers use TransferWise through a global network and the company plans to start services to and from Hong Kong this year.

TransferWise was created after Estonian-born co-founders Hinrikus and Kristo Kaarmann became frustrated with the high fees charged by banks on money sent from London back to their homeland. Venture capitalists have valued the firm at more than $1 billion.

The U.K. startup has also picked Singapore as its Asia Pacific hub. The move is an early win for Singapore’s government which is trying to turn the affluent city state into a financial technology hub in Asia to create jobs and bolster its economy.

“The question is, ‘What are we going to see in three years or five years?’" Hinrikus said. “Ten percent of people who transfer money from the U.K. use TransferWise. Hopefully we can have 10 percent in Singapore.”

Bloomberg News