How often do international transactions actually occur though (for small payments between friends)? I feel like it is such a small market it probably is not worth the extra hassle from a legal/fraud standpoint.

As for outside the US, I was under the impression that most banks provide a free service for these transactions.

Remittances are one of the largest capital flows to developing countries totaling $400 billion in 2014.

As they say, if you could capture 1% of that market ...

... then you still wouldn't make much money because the margins are so low.

> just enter bank issued debit card for fee-free transactions.

IIRC, Square is only able to do this by abusing the "refund" feature of debit cards to credit money to those accounts. I read an article a while back that claimed the banks were not happy about this, and considering shutting it down (or rate-limiting it) in the future.

I believe that was only speculation as to the method.. Though the alternative that was speculated was transfers at a loss to Square (with an increased user base as the motive).

Check out transferwise.com.

Definitely second transferwise. I use it all the time, and it's fast and easy without seeming skeevy like Western Union or whatever.

What's the catch?

So far, none that have caught up with me. It does what it says on the tin, and it's cheap and fast. I'm not sure there is a catch.

I guess that's what https://www.circle.com tries to be. I haven't personally tried them tough.

... and insurance-free, as opposed to credit cards