FriendlyExpat

I need to transfer £2,000 from a UK bank to a French bank for a friend. What is the cheapest method? I was looking at this article: http://www.moneysavingexpert.com/ban...exchange#step2

Lots of options, but it doesn't say which method is cheapest!!

Thanks!!
James

FriendlyExpat

To answer my own question, and in case anyone else sees this thread in future, it seems the absolute cheapest way would be to pay through a UK credit card such as the Halifax Clarity Mastercard, where there is no loading fee or charge for foreign use.

Unfortunately in my case I can't use a credit card, so the next cheapest seems to be to send it through a specialised foreign transfer company. MSE recommended one called "currencies direct" - I just got a quote and they are "fee free" but make their money by adding around a 0.5% hit to the exchange rate - this is quite good.

I also checked with my own bank and they are eye-wateringly expensive by comparison, although it's the most convenient way obviously.

bigglesworth

There are quite a few cheaper methods than using a bank.
Currency fair is a peer to peer service. I have not used it but then I use currency brokers - usually Rationalfx, who have always played fair with me.
The amount they take varies from about .75 of a cent to Hifx who take quite a bit more. Currencies direct and caxtons have been OK.

But do understand that there is greater risk. although they are regulated by the FCA, I don't believe the deposits are protected to the same extent. If anyone can confirm that i would be grateful. I have always proceeded on the basis that I only need to transfer successfully a dozen times or so using a broker for the amount I have saved by NOT using a bank outweighs the slight possibility that I might lose all the transfer.

InVinoVeritas

This may be not relevant now (but perhaps in the future) but anyone with an HSBC Premier account can make a global transfer via internet banking which is both instant and completely free. If there is a currency conversion involved then the rate is less than 1%. Of course you have to have an HSBC account in both countries.

bigglesworth

I think you have to keep a sizeable balance with them though, which essentially is a free loan as the interest rate is negligible, even in good times. Unless they have changed? It is four or five years ago that I last spoke to them.

Sorry IVV that was in reply to your post

InVinoVeritas

No it's certainly not worth opening an HSBC Premier account for this reason alone but...if you already got one...it's an excellent way to move money around.

suppleberry

Yes that's right in that there is not the protection you have with a bank if the company goes into insolvency. The brokers are supposed to keep client money in segregated accounts so it's not mixed with their normal funds, but in the event of the company going bust I'm not sure what that would mean in practice. I think you would just be treated as any other unsecured creditor. You certainly couldn't be sure of having amounts guaranteed by the state, which they are with a regulated bank.

If you use a currency broker, then just be aware that there is this risk.

suppleberry

In fact, according to the article below, what I've said is not correct and there should be some protection (although this is an old article)

http://www.telegraph.co.uk/finance/p...-overseas.html

Novocastrian

Yes and no. You need to have a sizeable balance, but it doesn't have to be in a checking account or in a regular savings account, which pay either zero or negligible interest at the moment.

We simply transferred a sufficient amount of our, (actually the wife's ) retirement pot to HSBC managed tax protected retirement investment plans. (The exact terms for these things are country specific, in Canada they are Registered Retirement Saving Plans).

They've done at least as well as the previous fund manager.

bigglesworth

Thanks NC. Food for thought, especially after the Budget

Novocastrian

I'm guessing you mean the UK budget? The changes in the annuity rules?

bigglesworth

Yes. I did not plan on taking an annuity anyway. (Not that there was much left of my company pot after Mr Brown).
But especially after the review announced this morning, which was a bit unexpected.
On balance, it seems wiser to let the dust settle before making any firm decision. The only pension decision I made in haste was when the last Government abolished the firewall between pension schemes within a group structure.

cjm

I have used several FX companies over the years, rule of thumb is the greater the level of exchange, the better the rate. £2k is not a large sum, so my guess is rate will approach bank rate.

Scots in Treignac

When I'm not in France, I use Hargreaves Lansdowne. They have a minimum transfer of £1000. Once I found someone else with a better rate HGL matched it.

If I'm in France I just transfer the maximum allowed on my debit card on a daily basis from a cash machine. I first started using a Nationwide card, then when they introduced charges , used Santander zero, now I'm back to Nationwide (Ithink it's called flex pus)

TinaBee

CurrencyFair every time for me. Quick easy and costs only €3 per transfer. You can also request a better rate on the marketplace if you think the rate is on the up