Personal overseas transfers

In an increasingly globalised world, the need to move money across borders has become a common occurrence for many individuals.

Whether it's for supporting family members abroad, settling payments for a dream vacation, or making a significant investment like purchasing property in a foreign country, international personal transfers are a vital service for a growing number of people.

But with various options available, each with its own set of pros and cons, how do you choose the best method for sending money internationally?

Sending money via banks

For starters, many turn to their trusted banks to handle international transfers. This traditional method is convenient when both the sender and recipient have bank accounts.

Typically, you can expect to transfer amounts ranging from £500 to £5,000 through this channel. However, it's not all smooth sailing with bank transfers.

They can take up to five days to process, and you might be hit with fees around £40 per transaction.

Additionally, for those in need of faster service, banks often offer an express transfer option for an additional fee.

Exchange rate loading

Moreover, banks often add a markup on the exchange rate, which can significantly inflate the cost of your transfer.

It's crucial to ask your bank for the exact amount of foreign currency your recipient will receive. This way, you can fully understand the total cost of your transaction and avoid any unpleasant surprises.

Foreign exchange broker

If you're looking for a potentially more cost-effective alternative, you might want to consider a foreign exchange broker. Registering with a broker is usually a straightforward and non-committal process, and it could save you money in the long run.

Broker transfer process

Once you've registered, transferring money through a broker involves confirming the transaction details, such as the amount and the recipient's information. Then, you'll send the funds to the broker, who will handle the electronic transfer to the recipient's account.

Competitive rates

One of the significant advantages of using brokers is that they often do not charge fees on transfers above £3,000.

Additionally, they tend to offer more competitive exchange rates than banks. However, it's always wise to check for any hidden charges before you finalize a deal to ensure you're truly getting the best rate.

Time the transaction

Brokers also offer flexibility in timing your transactions. You can take advantage of exchange rate fluctuations by choosing from various options such as spot rate transactions, forward contracts, and limit orders. This flexibility can lead to substantial savings, especially for larger transfers.

High-street firm

If you don’t have access to a bank account, a money transfer firm might be the answer. You can usually conduct the transfer online, but many such firms, such as MoneyGram and Western Union, also have a high-street presence. These services are especially convenient for those who prefer to deal in cash or do not have a bank account.

Money transfer firm process

The process of sending money through a high-street transfer firm involves paying the transfer amount along with any associated fees. These firms also apply an exchange rate markup. Once the transaction is complete, recipients can usually collect the money immediately from the firm's branches, which are available worldwide.

Security

When transferring money internationally, security should be a top priority. Banks are typically regulated by the Financial Conduct Authority (FCA) and are part of the Financial Services Compensation Scheme (FSCS), offering a degree of protection for your funds.

Non-FCA regulated Entities

However, it's important to note that not all transfer firms or brokers are authorized by the FCA. Using a non-regulated entity may not provide the same level of protection as those regulated by the FSCS, so it's essential to do your due diligence.

Compare costs

Finally, to ensure you're getting the best deal for your international money transfer, it's advisable to compare the costs across different services. MoneySuperMarket’s comparison service is an excellent tool for this purpose, helping you navigate the complexities of international money transfers and find the most cost-effective option.