What’s the deal?
A “no fees” currency transfer service from the Post Office, aimed at Britons who have holiday homes overseas or who want their pension paid abroad.
The online and phone-based Overseas Property Money Transfer service allows transfers between UK and overseas bank accounts in six currencies: US dollars, euros, Australian, Canadian and New Zealand dollars, and Dubai/UAE dirhams.
Meanwhile, HiFX, the currency broker that provides the Post Office’s service, is adding a further 14 currencies to its own online transfer facility from this week. These include the South African rand, yen, Swiss francs, and a range of east European currencies.
With both services, there are no commissions or other charges – the quoted exchange rate includes transfer costs and fees levied by receiving banks.
The minimum transfer with HiFX is £250, or £500 with the Post Office. HiFX is increasing its maximum online transfer to £50,000 while, with the Post Office, transfers above £10,000 have to be arranged by phone.
The broker will also accept payment by bank transfer at no cost. Both services make no charge for debit card settlement but levy 1.5 per cent on credit card payments.
Is this good?
Specialist currency services claim to be cheaper than the banks, which many people use to send money overseas. HiFX says its exchange rates are up to 4 per cent better than those from banks, and are within 1 per cent of wholesale currency rates, depending on the amount transferred. The banks’ charges can also add up: as well as transfer fees of £30, switches may incur 1.5 per cent commission costs and receiving charges of another 0.5 per cent.
What’s the catch?
The Post Office service is not available over the counter. Transfers by phone give less favourable rates than online. HiFX also says that customers could still be hit by unexpected receiving charges on transfers overseas. However, the broker will refund these costs to customers who put in a claim.
The 1.5 per cent charge for paying by credit card could prove hefty, but can be avoided by using other payment methods.
What’s the alternative?
Caxton FX has a similar online service covering 17 currencies, though customers are responsible for any receiving bank charges. Its exchange rates can be up to 1.5 per cent off the spot rate.
With no currency broker standing out as offering the best deal, experts say it is worth shopping around – particularly for large transfers. There may also be room for negotiation. When making comparisons, the key question to ask is how much currency you will receive for an amount of sterling, including all fees and charges.
Some banks allow no-fee transfers to overseas accounts with the same institution. For smaller transfers, the Post Office and other high street outlets offer the MoneyGram service.
How do I find out more?
www.postoffice.co.uk/moneytransfers or 0800 180 4702
www.hifx.co.uk
www.caxtonfx.com
