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Sending Money Abroad

How to send cash overseas cheaply

Currency signs Gifting a Stateside nephew or wiring emergency funds to a travelling daughter needn't require astronomical costs - some banks charge up to £25, so use MoneySaving ways to make sure you don't get ripped off.

This step-by-step guide teaches you how to send money on the cheap. Whether it's one-off or a regular payment, you'll save some serious cash.

What will it cost?

The two key drains on your lump sum will be the fee, and the exchange rate. Don't be seduced by 'fee-free rates' - the exchange rate is often adjusted to make up for the loss. ** PLEASE DESCRIBE THIS IMAGE **

  • Fee.

    The obvious charge.

    A multitude of fees, charges or commission can apply both to the sender and the recipient. Many providers impose multiples of small additional charges to disguise the real cost of the service.

  • Exchange rate.

    The hidden charge.

    Many companies claim to be 'commission-free' and then dampen the exchange rate so you get less bang for your buck. It's often difficult to get hold of the exact rate and compare it, as some providers don't publish daily rates which change throughout the day.

The best way to compare

A multitude of fees and exchange rates make transferring money seem like a complicated minefield. Quite simply, it boils down to one very simple key question:

After all charges, how many euros/yen/dollars will I get?

It sounds simple but sometimes it's hard to get an answer. Exchange rates change throughout the day, and possibly by the minute. In order to compare providers properly, you'll need to do it all in one go.

Start by benchmarking a decent exchange rate - check the Travel Money Maximiser to help. If you're transferring a large amount, then at worst you should aim to match the cheapest provider there, especially as most providers will have better rates the more you transfer - see below for more info if you've got £5,000 or more to send.

To find the best deal, follow the steps in this guide; each one lists who it's suitable for. Stop at the first method that suits you.

How safe is my cash when I transfer?

If you've got money in a UK savings account, there's a whole protection scheme set up to cover you if the provider goes bust. With foreign exchange money transfer companies it's a different ball game. Please take note:

There's NO compensation scheme if a firm goes bust

This is crucial to understand - if you use an online transfer company (or any transfer company that holds your money) and it goes bust while it has your money, there's no guarantee you'll get it back. The regulation of these companies has become tighter in the past few years, but the risk of losing cash still remains.

  • If it's 'authorised' - your money is kept separate.

    A large firm trading over €3 million (£2.4 million) a month, must be authorised by the Financial Conduct Authority (FCA). Each day, at the close of business, these firms separate your money from the firm's own accounts (known as ringfencing). This protects your cash, so you should get it back if the firm gets into difficulty.

  • If it's 'registered' - there are no safeguards for your cash.

    Smaller firms can choose to be registered. This means there's no safety process if something goes wrong with the firm, meaning your money isn't protected.

To check how a firm is regulated (whether it's authorised or just registered), search for its name on the FCA register. For more information on your protection, this Sending Money Safely leaflet from the Money Advice Service is useful.

Quick question

What can I do if the firm loses my money in transfer?

Use specialist plastic for regular transfers

These are designed to be used for purchases, so if you can, the easiest and cheapest way is to spend on specialist credit or debit cards. You can pay for things overseas at the best possible exchange rate with minimum fees.

Who's it suitable for?

If you need to spend money in shops or withdraw cash in another country, or if you've a relative living abroad who you're happy to pay for. Typical examples include:

  • If you or your partner need to spend cash abroad.

  • If you've a friend or relative you trust who lives abroad

  • Paying overseas bills eg, for second homeowners, provided companies you pay accept plastic, or you visit often enough to withdraw from ATMs.

You get the best possible exchange rate

Most normal cards add a 3% 'load' on the exchange rate so £100 of foreign currency actually costs £103. These specialist cards get you the Visa/Mastercard wholesale rate, so it's about as good as it gets, and is cheaper than buying foreign currency.

Plus unlike most cards, it will cost you little or nothing to withdraw cash from an overseas ATM.

Grab the plastic and use it to spend or withdraw cash as your normally would. As it's a UK account, just pay it off at home.

ALWAYS set up a direct debit to pay it off in full each month to avoid paying interest on any spending. You'll pay a month's interest on credit card cash withdrawals, but this is almost negligible compared to the benefits.

Halifax Clarity Credit Card

Get top exchange rates on spending abroad

Halifax*

The Clarity card from Halifax* has no foreign exchange fee anywhere in the world, so you'll get the best rate possible. Spending is free, and cash withdrawals have no fee (although you will pay interest from when you make them, until they're paid off). Use it abroad yourself, or if you've a friend or relative living abroad, make them a secondary cardholder - it's cheaper this way than transferring cash all the time.

Need to Knows
  • Halifax uses Mastercard's exchange rate which you can check here, although the most recent rate you'll be able to see is that from the previous day.
  • You can only withdraw up to 50% of the credit limit as cash, so it's better - and cheaper - to prioritise spending.
  • Interest on cash withdrawals works out at around £1 per month if you withdraw £100 (assuming a 12.9% APR)
  • Some people accepted for the card will get 17.9% or 21.9%, meaning more interest's charged on cash withdrawals.
Eligibility Calculator
(MSE’s free tool)
APPLY*
(at lender site)

Protect your credit score and check chances of getting card

Stats box
  • Loading (exchange rate fee): Europe 0% | Worldwide 0%
  • Overseas cash withdrawals: Fee-free
  • Interest on cash withdrawals?: Yes, until repaid in full (1.02% per month)
  • Minimum payment: Greater of 1% of balance plus interest, or £5
  • Min income: n/a | Card issuer: Mastercard
  • Rate: 12.9% representative APR (see Official APR Examples)

Free bank transfers (BOTH need the account)

A number of banks allow you to transfer money to linked banks overseas without a fee; usually it's just an overseas arm of the same banking group. So if both you and the person you want to send money to open accounts, you can move money between them cheaply.

There is one major difference though. One allows you to send money to anyone who holds an account with the same bank overseas, while the other group requires both the UK and the foreign account to be in YOUR name.

Who's it suitable for?

This is best for regular movements of money to people who stay in one country. Typical examples include:

  • Regular cash to family members who live overseas.

  • Payments for services on homes abroad.

HSBC

Free worldwide transfers to HSBC accounts

HSBC's transfer service is free for any HSBC customer transferring money to any other HSBC account, as long as you transfer through their online banking system.

If the recipient doesn't have an HSBC account, the transfer will cost £4. Transferring by telephone or in branch is more expensive and costs £20 and £30 respectively.

It's worth checking HSBC's exchange rates, as they're not always the best. So compare with the specialist international transfer companies below. It may be that, even with a fee, their exchange rate's much better, and effectively cancels out the fee.

Transfer limits depend on how you send the money. The free online option is limited to £50,000, transferring by telephone is £10,000, whereas an unlimited limit applies to transfers via branch. If you need to transfer large amounts of money by branch (which takes an unlimited amount), spending £30 while transferring £50,000+ is marginal.

Thinking about using HSBC? Click here for more info

Citibank

Fee-free for Citibank transfers

To get fee-free transfers, you'll need to open a Citibank Foreign Currency Deposit account, and make sure your intended recipient of the cash has a Citi account. You can then make a fee-free transfer between your account and theirs.

The Foreign Currency account is bolted on top of a Citi current account. To avoid a £5/month fee, you must maintain an average monthly balance of the equivalent of £2,000 in foreign currency, or be a Citibank Plus or Citigold holder (see Best Premier Current Accounts and Best Bank Accounts to compare).

Your money will usually arrive in the recipient's account within five minutes. It works for 26 countries including the US, India, China, Germany and Australia (see a full list).

Thinking about using Citi? Click here for more info

Fee-free to your foreign account

A number of banks also have relationships that allow you to send money without a fee at good exchange rates. However, both the UK account, and the one in the country you are sending to, usually need to be in your name.

This means it's more useful if you have a second home abroad, for example, and need to pay bills, but less so for sending cash to friends and family.

  • To India. If you open a State Bank of India UK Instant Access Savings Account and maintain a minimum balance of £500, you can send money to any Indian bank account via the SBI express remittance service.


  • USA, Hong Kong, and more. HSBC offers fee-free same day transfers to 36 countries, but you need its Premier bank account (to qualify for this account you need £50k savings, a £250k mortgage with HSBC, or £75k salary going into your HSBC Premier account).

    Lloyds Bank offers a similar Premier International account which operates in three currencies. The £20 monthly fee is scrapped if you keep balances above £2,500. It requires a minimum £50k income, or £25,000 deposit within 3 months of opening the account. You'll be able to make free international money transfers online, by phone, or by standing order.


  • To Scandinavian & Baltic countries. Danske Bank has branches in Northern Ireland, plus online banking, and if you have one of its accounts, you can transfer to any other account you hold in the Danske group. The Danske Bank Group operates in Finland, Denmark, Sweden, Norway, Estonia, Latvia, Lithuania, Ireland, Northern Ireland, Germany, Poland, Luxembourg, Russia, the United States and the United Kingdom.

Know any not here? If you know of another bank offering fee-free transfers to a specific country, please let us know.

Online services for one-off small payments

A number of companies allow you to send money online, either through e-commerce systems or simply by moving your money into someone else's bank account, but the correct system depends on how much money you want to send.

Who's it suitable for?

This is generally suitable for non-urgent transfers of smaller amounts of money. Typical examples include:

  • Payments for goods received, eg, on eBay.

  • Sending a one-off sum of money to a friend/family member overseas, e.g. for Xmas gifts.

It is very important to be aware that no compensation scheme exists if these firms were to go bust - read full details in Am I protected?

There are a number of UK firms designed specifically for international money transfers. You pay them in sterling, usually via internet transfer, which they convert and send to the receiving bank within two to four working days. You'll need to set up an account and have your address verified first, which can take a few days.

For smaller amounts, the options below are worth considering. But if you have a big overseas purchase to make - of £5,000 or more - you're better off calling up a forex broker. See below for step-by-step help.

Transferwise

Pay from £1 to transfer with a peer-to-peer currency service

Transferwise*

It's not a traditional currency broker, but peer-to-peer currency specialist Transferwise* lets you transfer cash from as little as £1 online, one of the lowest transfer fees we've seen. They can do this as you never actually transfer any money, but have reserves of currency in several different countries. So you'd pay into the UK pot, and your recipient is paid out from the euro, dollar or rupee pot, depending on where they live.

How does this work?
  • You can trade 20 currencies, including US dollars, euros, Indian rupees, New Zealand and Australian dollars
  • Fees are low, just £1 on transfers up to £200 and 0.5% above that. The exact fee will be shown when you make the transfer.
  • You're able to transfer anything from £1 to £1 million - though it's best to check that Transferwise have the funds if you're transferring larger amounts.
  • Transferwise is authorised by the Financial Conduct Authority (FCA). This means any money you send using the service is kept separate from company accounts. See Is my money protected? for more details.

How does 'peer-to-peer' work?

Currencies Direct

Strong exchange rate, and fee-free over £500

Currencies Direct*

Online transfer service Currencies Direct* is good if you're sending more than £500 as it's fee free (only via this link), plus it's rates are some of the best we've seen. Plus, if you're likely to make a lot of transfers within the next 12 months, apply using this Currencies Direct* link, as you'll be able to get a £75 Amazon voucher if you send £10,000+ abroad.

How does this work?
  • Transfers can be made with around 25 currencies, including euros, US dollars, SA rand, and the Indian rupee.
  • Your rate's dependent on how much you send. The more you transfer, the better the rate (though you can only transfer £15,000 online - you'll need to call them if you want to transfer more.
  • To get the Amazon voucher, you must set up an account before Fri 2 Jan 2015 & send £10k+ abroad within a 12mth period (in any number of transfers)
  • Currencies Direct is authorised by the Financial Conduct Authority, so any money you send is kept separate from the company's accounts. See Is my money protected? for more details.
FairFX

Decent rates, and fee-free from £600

FairFX

Usually better known for its top-pick prepaid travel card, FairFX also has a fee-free money transfer service provided you're transferring more than £600.

How does this work?
  • It's available in 11 main currencies, including euros, dollars, Indian rupees and Japanese yen. Other currencies are available on request.
  • Your cash will arrive in the receiving account in one to three days.
  • Better rates are also available the more you send, but you'll get an indication of the rate before you begin the transfer.
  • You can transfer up to £250,000 online, but can call them if you need to transfer more.
  • FairFX is authorised by the Financial Conduct Authority, so any money you send is kept separate from the company's accounts. See Is my money protected? for more details.
Travelex

Widest range of currencies available, but only fee-free above £2,500

Travelex

Travelex is a big name player, and sending cash via its International Payments service tends to give you some of the best rates on the market. However, the downside is that it costs to send small amounts, though transfers over £2,500 are fee-free.

How does this work?
  • It's got the largest range of currencies, including US dollars, Australian dollars and euros.
  • You can get an indication of the rate you'll get on its homepage, but for an accurate rate for the amount you want to send, you'll need to sign up & register for an account.
  • You pay fees on smaller amounts, £7 is the standard for transfers between £300 and £2,500.
  • You can transfer up to £200,000 online (more over the phone)
  • Your cash will arrive within one to three days
  • Travelex offers a price promise, guaranteeing to beat a competitor's quote if you find one cheaper within 30 minutes of getting one from Travelex.
  • Travelex's International Payments service is run by UKForex, which is authorised by the Financial Conduct Authority. See Is my money protected? for more details.

Sending larger amounts (£5,000+)

When the amount you wish to transfer jumps to the 'serious' level, the only players able to give a good rate are specialised foreign exchange brokers.

There are a lot of companies, and the same lack of protection applies as above - so be very diligent in checking, as the amount you could lose is huge.

Who's it suitable for?

This method only really adds up for sending a few thousand pounds at least, or making slightly smaller, but regular payments. It's possible to use this method for smaller amounts too, but then it's costlier. Typical examples include:

  • Buying/selling property abroad.

  • Making regular payments - this includes overseas mortgages, bills or a pension.

  • If you're moving abroad and want to convert all your cash.

It is very important to be aware that no compensation scheme exists if these firms were to go bust - read full details in Am I protected?

How to do it?

When transferring larger sums, it's important to remember that even small differentials in exchange rates can make an enormous difference.

Think about it - a 1% rate improvement on £100,000 is a £1,000 gain. So finessing the very best rate takes on even more significance.

  1. Benchmark the rate.

    Quickly go to the Travel Money Maximiser to check out the best rates. That finds the top rates for getting cash when going on holiday, so you should be aiming to beat its best rate, after all fees.

  2. Ask your bank for a quote.

    It's rare your bank will actually be the best buy. But it's a very useful second benchmark. Some have special facilities for existing customers, so it could actually come up trumps.

  3. Use a specialist currency broker.

    These companies buy and sell vast sums of foreign currency which allows them to offer excellent exchange rates because, even if they only make a small percentage profit on every pound, that soon adds up when you're dealing in hundreds of millions of pounds.

Quick questions:

What do they usually offer?

Should I get quotes around the same time?

What if the rate isn't as good as I'd like?

If the rate is good now and I don't think it'll get better, can I lock it in?

Can I negotiate on the rate?

There is no hard and fast rule to which currency broker is best, so get quotes from all of them to find the the best rate for your currency. The regularly quoted big brokers below are the obvious places to start - though of course, they're still no more protected than any of the others.

Currencies Direct

Strong exchange rate, and fee free over £500

Currencies Direct*

Also a top pick for smaller amounts, Currencies Direct* has good rates and is fee-free if you've over £500 to transfer. You'll need to open an account with it before you can start making transfers but transfers under £15,000 can be done online. For bigger transfers, you'll need to give it a call.

How does this work?
  • Currencies Direct is currently offering MoneySavingExpert.com users a £75 Amazon voucher when they sign up for an account and send £10,000+ in one or more transactions over a 12 month period.
  • To qualify, you need to sign up to Currencies Direct (using the link above) before 2 Jan 2015, and send and pay for at least £10,000 of foreign currency trades within 12 months. You'll get the voucher within 30 days of sending £10,000 or more.
  • Currencies Direct is authorised by the FCA, the highest level of regulation they can have - see above for what this means.
UKForex

Strong exchange rate, and fee free over £3,000

UKForex

If you're looking for top rates then UKForex lets you transfer online or over the phone. It has offices in several different countries, which not only means that you can call 24 hours a day (if you need support), but also means that for larger currencies it's not actually transferring cash across borders. Instead, it's paying your recipient from its own in-currency account, meaning you get better rates.

How does this work?
  • UKForex can transfer a decent range of currencies - more than 50 can be transacted online, and cash will usually arrive within one or two days.
  • Fee free for £3,000 or more, a charge of £7 if you're transferring less.
  • UKForex won't do transfers of less than £750, so check the providers above if that's what you need.
  • UKForex is authorised by the FCA, the highest level of regulation it can have - see above for what this means.
MoneyCorp

Low minimum transfer amounts

Moneycorp*

If you need to send a smaller amount more frequently, Moneycorp* allows regular transfers starting from £250, though fees are higher than for some of the services above.

How does this work?
  • For regular transfers, standard payments (taking 3-5 days) cost £4 and express payments (arrive within two days) cost £8.
  • If you just want to make a one-off payment, these fees are slighly higher at £5 and £9 respectively
  • Transfers can be made online or over the phone (though phone transfers cost more).
  • Moneycorp is authorised by the FCA, the highest level of regulation it can have - see above for what this means.

WARNING! There's no compensation scheme

Unlike banks, currency exchange businesses are not covered by the Financial Services Compensation Scheme, so there's always the risk, if something goes wrong, you won't be guaranteed full compensation (full details in 'how safe is my cash?' above).

Knowing this, these companies work hard to prove their stability, and a little research should bear that out. For example, HiFX stores your money in a Barclays account while it's in transit before it hits your account overseas.

See a full Q&A on international money transfers.

Need to transfer instantly? Last resort instant transfers

The methods above will all take a few days for the money to hit the destination, although check first - some may only take a day and you'll be far better off if you can wait. It's much cheaper than the options below.

But, if speed is paramount, a few companies offer instant cash transfers to thousands of locations anywhere in the world. Be warned, they ain't necessarily cheap...

Who's it suitable for?

Those who need to move cash at speed, or where the recipient doesn't have a bank account in that country. Typical examples include:

  • Emergency funds for a friend/family overseas. If a backpacking son or daughter, or a friend who's had all their cards nicked, needs cash.

It is very important to be aware that no compensation scheme exists if these firms were to go bust - read full details in Am I protected?

Do remember it's far better, if possible, to set up the card system above.

How does it work?

You either go into a branch (there are many in newsagents, post offices and banks) or pay the money online. The recipient then picks it up at an agency at the other end once it's done - they don't need to be there that moment. They can either present ID or, if that's a problem, a code can be used to legitimise the transfer.

 

The word "cheapest" should only be used advisedly here. This isn't a cheap service, and should only be done if necessary. It's extremely expensive, especially for small amounts, though the recipient won't normally need to pay a fee.

The most important thing to do in this case is to check that there's an agent/branch where the recipient can pick up the cash. The two big operators are Moneygram and Western Union.

If you've the luxury of a choice between the two (they tend to have different agents), check both and choose the cheapest for the amount and country you're sending money to. It's not really a case of being able to say which one will be cheaper in terms of fees, but Western Union tends to win on rates - though not always, so it's another thing you should check. We've done some examples to help illustrate the fees you could face...

Fees for sending cash with Western Union & MoneyGram
Amount Country Western Union - pick up Western Union - to account MoneyGram - pick up MoneyGram - to account
£100 China £6.90 £4.90 £4.90 £4.90
£100 Brazil £6.90 n/a £2.99 £2.99
£100 Australia £5.90 £4.90 £8.99 n/a
£500 USA £24.90 n/a £9.90 n/a
£500 Argentina £12.90 n/a £36.00 n/a
£500 Thailand £25.90 £4.90 £19.99 n/a
£1,000 Sweden £85.00 £4.90 £24.99 n/a
£1,000 Vietnam £29.90 £4.90 £41.00 n/a
£1,000 Pakistan £19.90 £0 £8.90 n/a

Assumes all transactions made online using a credit/debit card. Different fees apply if you go to an agent and pay cash/card, or if you do a bank transfer online. Fees correct as at December 2014.

There are also firms which provide transfers from the UK to specific countries, which can often be found in areas where there's a large community of those of that ethnic origin.

Both the big firms here are Financial Conduct Authority-authorised, which is the highest protection a currency broker can have, though it doesn't mean your money is completely secure - read full details in Am I protected?

International transfers Q&A

What information do I need about the person/business I'm sending money to?

Are there different rules depending on the country I'm transferring to?

How will the money be received?

What happens if things go wrong?

How do I know the money will get there?