International money transfers explained
If you want to send money overseas, foreign exchanges and currency brokers often charge no fees and can offer better exchange rates than a high street bank. So how does it work?
Key takeaways
International money transfers require converting currency, and transfer speed varies depending on the provider and method used
Fees and charges include transfer fees, exchange rate mark-ups, and intermediary bank costs, which can reduce the received amount
Comparing online providers helps find the best exchange rates and lowest fees for cost-effective international transfers
Different transfer methods, like SWIFT, SEPA, or specialist money transfer services, impact costs, speed, and convenience
When you send or spend money overseas, you need to convert it into the local currency. This process usually comes with a cost, either through fees or the exchange rate offered or both.
Banks and providers set their own rates, which may include a mark-up compared to the real exchange rate.
There are several ways to send money abroad. High street banks offer international transfers but may charge high fees and use less competitive exchange rates.
Specialist money transfer firms, such as online providers, often provide lower fees and better rates. Choosing the right option can help reduce costs and ensure more of your money reaches its destination.
How does international money transfer work?
An international money order works differently depending on which provider you use, but they usually involve the following:
You’ll first need to register an account with the international money transfer firm
They will get in touch to discuss the transfer, informing you about the fees, exchange rates and any other necessary information you’ll need to approve before moving forward
You can then book the transaction, giving details of the recipient’s account and pay the agreed amount, typically by electronic transfer from your UK bank account
How much do international money transfers cost?
There can be a number of fees associated with sending money abroad. Try to understand the costs before agreeing to the transfer. Charges may include:
Charged by the sending bank or provider for processing the transaction. Example: Up to £50 per transfer, or 0.5–3% for online providers.
The difference between the mid-market exchange rate and the provider’s offered rate. Example: Banks may add a 2–5% mark-up, while specialist providers offer lower margins.
If the transfer goes through multiple banks, they may deduct a fee. Example: £10–£30 per intermediary bank.
Some banks charge the recipient for processing an incoming international transfer. Example: £5–£20, depending on the bank and country.
Some providers charge extra for same-day or faster transfers. Example: £10–£20 extra for priority processing.
Sending money abroad fees
Transfer fee
Exchange rate mark-up
Intermediary bank fees
Receiving bank fee
Urgency fee
How long does it take to receive money from an international money transfer?
International money transfers typically take anywhere from a few minutes to several days.
The speed depends on factors like the provider, destination country, payment method, and banking hours.
Specialist transfer services often process payments faster than traditional banks, which may take up to five working days due to intermediary banks and processing times.
How do I transfer money to a foreign bank account?
There are several ways you can go about transferring money overseas.
International money transfer firms typically offer competitive rates and count as one of the safer methods. Money transfer firms usually handle larger transfers, perhaps over £3,000. Their fees tend to be minimal and they offer more competitive exchange rates
High street transfer services are faster but more suitable for business money transfers, as the charges they levy on small amounts and personal money transfers can be quite high
Bank transfers can be arranged with a visit to your branch or through online and mobile banking. This is one of the most convenient ways to transfer money overseas as you won’t need to register. You’ll also be able to set up a transfer as a regular payment and will be covered by the Financial Conduct Authority. You pay for the convenience however, as the fees tend to be high and the exchange rates less good
What is a SWIFT transfer?
A SWIFT transfer is one of the most popular forms of international money transfer and enables secure information, including financial transactions, to be transferred between banks safely.
It is a messaging system used by most financial institutions, and it stands for the ‘Society of Worldwide Interbank Financial Telecommunications’:
SWIFT works similarly to a domestic transfer: your money will be transferred from one country to another, between financial institutions. The transfer requires an intermediary as it is international and usually requires extra information and specific authorisation.
SWIFT transfers usually take up to five business days to process, depending on factors like the banks involved, time zones, and currency conversion.
Delays can occur due to intermediary banks, compliance checks, and banking hours. Some banks offer faster SWIFT transfers, but these may come with higher fees.
SWIFT transfer costs vary depending on the banks involved, but typically include:
Sending bank fees. Could be up to £50 per transfer, depending on the bank and urgency
Intermediary bank fees. Additional charges if the money passes through multiple banks
Receiving bank fees. Some banks charge to process incoming SWIFT payments
Specialist money transfer providers often offer cheaper alternatives.
No. While SWIFT is a widely used network for bank-to-bank transfers, other systems exist, including:
SEPA (Single Euro Payments Area). Used for euro transfers within Europe. Often faster and cheaper than SWIFT
Faster Payment Networks. Some countries have their own instant or near-instant international transfer systems
Money Transfer Operators (MTOs): Services like Western Union, MoneyGram, and Wise use their own networks instead of SWIFT
How does a SWIFT transfer work?
How long do SWIFT transfers take?
How much do SWIFT transfers cost?
Do all international money transfers use SWIFT?
What is a SEPA transfer?
SEPA transfers can be made between any country which uses the euro as its currency. SEPA stands for the ‘Single Euro Payments Area’, and is part of a system designed to make transferring money between the participating countries as simple as domestic transactions. It has a number of perks:
You’ll be able to use your debit card anywhere the euro is accepted
SEPA can speed up international money transfers and keep to the guaranteed time
Banks aren’t allowed to make any deductions on the balance transferred
What details do I need for an international bank transfer?
For an international bank transfer, you typically need the following details:
Recipient’s full name (as registered with their bank)
Recipient’s bank name and address
Recipient’s account number or IBAN (International Bank Account Number)
Bank’s SWIFT/BIC (Business Identifier Code)
Currency and transfer amount
Where can I find the IBAN and SWIFT/BIC?
The recipient can find their IBAN and SWIFT/BIC on their bank statements, online banking portal, or banking app. Most banks also list their SWIFT/BIC codes on their website. If unsure, the recipient can contact their bank’s customer service for confirmation.
Personal Finance Expert
Our expert says...
“All the different and often seemingly hidden fees and charges for foreign exchange can undermine confidence in the process. But when you send money overseas, as well as the transaction being secure, the main comparison you need to make is how much of your chosen currency will you get for your pound. Understand this and you can always pick the most cost-efficient deal.”
Compare brokers with MoneySuperMarket and FXcompared.com
The cost of international money transfers varies from broker to broker.
MoneySuperMarket has partnered with FXcompared.com to show you competitive money transfer deals from a range of registered currency brokers who can help move money to and from more than 125 countries throughout the world.
You can see exchange rates, fees and speed of transfer before deciding which transfer provider you want to use. You can lock in a rate online or over the phone for up to 12 months and pay by debit card or bank transfer into the account you’ve created. Funds will then be transferred safely and securely.
