Your bank is no longer the only way to move money from one country to another. Here is a closer look at your options for international money transfers:
More and more business takes place across borders and as a result currencies need to be exchanged 24hours a day. As the world has changed, so have our options. Whilst the high street bank is still the most recognised route for transferring money, there are two more options that are growing in popularity.
Currency brokers, peer-to-peer services and high street banks all have their strengths and weaknesses and you have to decide which service suits your needs best.
As per tradition, this remains the most recognised method for money transfers. It is convenient, well established and regulated. However, if you listen to currency brokers and peer-to-peer services, high-street banks do not offer the best rates.
There is of course, a variety of fees and services when it comes to money transfers within the banking sector.
HSBC, for example, does not charge fees if you are moving money to another HSBC account and do so using online banking. For transfers to non-HSBC accounts, fees go from £4 to £30 depending on how you make the transfer and where it is to. The length of time it can take to transfer also varies depending on where it is being sent to; the transfer can happen on the same day or take up to four days.
Barclays, on the other hand, charges between £15 (for a European transfer) to £40 for a priority international transfer.
Lloyds charges £10 for an online transfer up to £5,000, but up to £35 for a branch deal of more than £5,000.
Transfers for both Lloyds and Barclays can take anywhere between one and twelve days depending on where the money is being sent to.
Natwest, has a different structure again, charging £10 for its standard transfer or £22 for any amount anywhere in the world which will take between two to four days to happen. If you need the money to be transferred within two days you can pay £30 for an urgent transfer to anywhere in the world.
The foreign exchange market will never be the same again since the introduction of currency brokers. They offer bank beating exchange rates, with low fees and quick delivery. However, where they really show their worth is with property transactions or when a transaction involves a large sums of money.
In addition to that, many offer the services of a personal adviser and the option to choose your exchange rates by using devices such as forward contracts.
If you are struggling to choose between brokers, then try CurrencyTransfer.com. They provide a curated list of reputable brokers who hold the highest regulatory credentials. Using this platform, you can compare brokers, decide who to trade with and at what rate.
This service aims to cut out the middle man completely, by matching buyers and sellers online. The firm behind the service, acts as the facilitator and if no one wants to buy or sell your currency, the firm itself makes the exchange.
The rates that you can get using such a service are close to those that the banks themselves use. This is possible because no expensive international transfer takes place, and as local transfers are almost always free, the only fees to pay are flat ones: 3 GBP, 3 Euros or 4 USD plus the firm’s exchanges rate margin.
According to leading peer to peer firm CurrencyFair, they are 90% cheaper than the banks and 70% cheaper than the brokers.
The two larger peer to peer organisations are CurrencyFair that currently offers 16 currencies, and Transferwise that currently offers 24 currencies but hopes to add another 35 by the end of the year.
Both are strictly regulated. Transferwise by the FCA and CurrencyFair by the Central Bank of Ireland, which it says has the same requirements as the FCA.
Thankfully, the world of finance is evolving to give consumers more options when it comes to transferring money around the world. Exploring currency brokers and peer-to-peer services are worthwhile, particularly if you need to transfer money regularly or you want to transfer a large one off sum. They offer competitive rates, speedy transfers and a much more transparent service then the banks.