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International Currency Transfers - Will Hewitson From FC Exchange
Carlie: Are all currency transfer companies essentially the same?
Will: There’s actually a range of companies that will send your money overseas, but it’s usually broken down into two categories; banks and brokers, and they’re very different. A lot of people automatically think to use their high-street bank, but banks offer foreign exchange as a branch of their services, whereas a broker focuses solely on currency. In essence, it means a broker can usually offer rates closer to the market rate, and you’ll be assigned your own dedicated currency expert who can help you navigate the market, which saves you calling up your bank and speaking to someone different each time.
Account managers also keep their clients up to date with market movements, so they can take advantage of a positive shift or protect their funds from negative ones. Plus, every transfer has the backing of our Best Exchange Rate Guarantee, just for extra peace of mind—which is what you want if you’re buying a house abroad or sending large amounts of money overseas.
Carlie: How do I know I’m getting a good rate? What's the benchmark?
Will: Well exchange rates never sleep so unless you watch markets all day every day, it can be a daunting prospect trying to figure out what rate’s good and what’s not. Since Brexit, the pound has fallen – in fact following the referendum it dropped by around 20%, which at the time was significant to those people who wanted to move large amounts of money abroad. If you were buying a house, say, the exchange rate decline meant that it became considerably more expensive – and sometimes the properties people thought they could afford slipped out of their price range in a matter of weeks or months.
A lot of people might not realise that there are so many things that can impact an exchange rate too. Things like commodity prices, economic data, political events, and even things like natural disasters and terrorism can all create market movement.
It’s always worth comparing rates between banks and brokers, but the sterling levels we saw last year are unlikely to reappear anytime soon. That’s why it’s so important to speak to a currency expert who’ll be able to tailor a plan for you, and keep you informed of any positive market shifts that you can take advantage of.
Carlie: What about fees? What's acceptable and what isn't?
Will: Fees can be a real dampener on currency transfers and they can be anywhere up to around £40 – so it’s definitely worth checking. Some institutions will charge you to send the money from one country, as well as imposing another charge when you receive it in another. If you think your chosen currency provider is giving you a great rate and then you discover you’ve got to spend £30 in fees, it takes the shine off the deal. This is especially true if you’re making regular payments.
FC Exchange has a minimum transfer value of £3,000, and you’ll never be charged any fees or hidden costs, so it makes your transfers even more cost-effective, especially when paired with a great rate.
Carlie: When is the best time to be transferring my money?
Will: It depends on your unique requirements and how the market is acting really. If you’ve signed a contract to buy a house then you’ll need to move your money quite quickly and ensure you get a great rate at the time. Whereas if you’re still in the initial house hunting stages, you’ve got longer to transfer and much more flexibility. If you register in advance of your transfer it means you’ve got more opportunity to maximise your funds.
With us, you can lock-in a competitive rate now, that can then be used up to two years in the future, so you don’t have to worry about how the market might shift – you’ll always have a stable amount of euros, dollars, or whatever currency you need for your move abroad. It’s really worth talking to an expert like your account manager as they’ll be able to create a strategy designed around your needs, to make the most of your money.
Carlie: I want to transfer a large chunk of cash – how do I know my money is safe?
Will: This is a really important question. So, when you’re looking to use a currency provider to move your money abroad, it’s important you check their credentials. We’re authorised by the Financial Conduct Authority, known as the FCA, as an E-money Institution, which means we have more flexibility in our services that other institutions without the accreditation. We also keep client funds in segregated accounts for their peace of mind, and we eliminate market exposure by buying the currency as soon as they book a transfer. We were one of the first FX brokers in the UK to become an Authorised Payment Institution too.
It’s also worth looking at Trust Pilot to see how well a company has been reviewed by its customers – these honest accounts from previous clients can help you understand more about the company and flag up any issues that customers have had. As well, it’s worth researching how long the company’s been in business and if you want to ask a representative any questions, then there’s always that option too.
Carlie: What kind of difference is there between a good and a bad rate?
Will: So just as an example, if you were looking at moving from the UK to Europe in June 2016 before the election, a £300,000 house hunting budget would have given you around €390,000. Then fast forward a few weeks after the referendum, and suddenly your £300,000 would only be worth approximately €348,000. So, in the space of a few weeks you’ve lost €42,000. That’s a big example, but even if one institution offers you a rate that’s just a few points different from another, the difference between them could still cost you thousands on a large lump sum.
Carlie: Where does the currency transfer company's responsibility begin and end with my cash?
Will: Brokers are becoming more popular with expats and those wanting to move their money abroad for a number of reasons. Firstly, the service is usually quicker and the rates can be considerably better. A broker’s process is quite simple; you agree on a rate and confirm the transfer amount, the broker buys your currency, you send your funds to the broker, and then the broker transfers it into a bank account of your choice overseas.
FC Exchange, it’s our responsibility to ensure that our clients receive their funds as soon as possible, are kept up to date in the process, and that their money arrives in the beneficiary account safely.
Carlie: How do I know where the best place is to keep my money if I’m moving between countries?
Will: This is a good question. Earlier I mentioned that we had additional flexibility as an E-Money Institution, and that means that we can hold client funds until they decide to make a transfer. So, say you’ve just sold your house in the UK and you’re moving to Germany, we can hold the proceeds of your house safely in either euros or pounds, while you pick out a house or organise an account to place your money into, and transfer them whenever you’re ready.
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