bats

So you really need to use Wise or whatever, can you just use your regular bank? In our case RBC

Helen1964

Hello.
Use for what?

durham_lad

Many things, such as council tax, utility contracts for electric and gas and mobile phone plans, don’t accept credit cards and you can’t set up a direct debit to a foreign bank.

tdrinker

Even where you can use a foreign bank, e.g. use their debit or credit card for shopping, withdrawing cash or whatever, the fees are likely to be higher than using a UK bank card. Certainly, many UK bank cards used overseas will add a 2-3% transaction fee and give you a poor exchange rate and I expect non-UK banks will do the same. If you need to contact them, e.g. to resolve a rejected transaction, you have a time zone issue. And you'd need to check that RBC would post you new cards to the UK when the old ones expire.

A Wise or similar account has its uses, but more as a supplement to a regular bank account than a replacement for it. Wise isn't a bank, therefore whereas UK bank funds up to £85k are government protected / refunded in the unlikely event of a bank failure, funds in Wise, etc. are not. Many bank accounts pay interest, have account benefits such as travel insurance, offer cashback credit cards, and so on.

Pulaski

I'm going to guess to transfer money to the UK, as that would be the only area where services of Wise and a Canadian bank overlap for someone relocating back to the UK.

Depending on the size of the sum(s) being transferred you will likely get up to 4% or 5% more GBP credited to your account in the UK by transferring the money use Wise compared to sending a wire from your bank, though for large transfers, i.e. CAD100,000+ your bank may be competitive with Wise if you request "a dealing desk rate" (use those words) from your bank, which will enable you to access the exchange rates available to companies for large transfers.

tdrinker

There are also some currency transfer companies that may be competitive with Wise, certainly for larger amounts.

The most important thing is security, not making a little extra. If the exchange rate sounds too good to be true, walk away.

Transfer a small amount first to make sure the process works - no errors in the IBAN or whatever. If transferring a large amount, certainty if using a company for the fist time, consider breaking the transfer into batches so if the worst happens (however unlikely) you don't lose it all.

Pulaski

It is unlikely that anyone could signifcantly beat Wise's rates when buying a freely-traded currency, as there is no incentive to exchange at a rate beyond the mid-rate, indeed it would be financially idiotic to do so as someone could change the currency back to the starting currency and repeat the cycle, making money every cycle.

E.g. the current CAD/GBP rate is that £1 will cost you about C$1.55, the mid rate at the time of posting, is CAD1.526, so that is the point at which anyone offering exchange services would neither make nor lose money, and any commercial business whether a bank or an online broker-remitter such as Wise has to charage more C$ than that to make money. If someone was will to sell you £1 for, say C$1.35 (an "unbelievable" rate), then you could take that £1 and exchange it at the market rate for about C$1.50 (mid rate less the spread), so you started wtih $1.35 and you now have $1.50 so you have made a profit of C$0.15 on the CAD->GBP->CAD round trip, and you could presumably repeat this cycle ad nauseam. The best possible deal is the close to the mid rate, and the only exceptions occur with currencies that do not float freely and trade at rates pegged by the central bank of the country. So for example in the 1980's it was possible to exchange hard western currencies such as the USD, GBP or DEM for local currency in eastern Europe where the exchange rates were fixed by the communist governments, because there were strict exchange controls and it wasn't legal for people in those countries to move their money out of the country and into western currencies. So individuals in eastern Europe, if given the opportunity, would pay a disadvantageous exchange rate to get hold of hard currency i.e. give you more local currnecy for your £1 or $1 than the government controlled banks would. And the reason this worked was that once a tourist had purchased local currency in say, Bulgaria, Romania or Czechoslovakia, there was no way for them to convert the cash back into western currency (for the same reason that residents could not buy western currency either), so the cycle could not be repeated.

bats

Our bank, RBC, has suggested that the best way for us to take our money over, house sale money, is to take a bankers draft and turn up at a uk bank with it to open an account

Helen1964

Have you tried calling a few UK banks and asking them how much they would charge to cash a bank draft denominated in a foreign currency?
Personally I think it sounds like a very bad idea. They’ll probably charge a hefty fee. You’ll have no control over the timing and therefore the exchange rate. And what if you lose the cheque?

I would open a Wise account now and put some sterling in it to start you off in the UK. Once you’re there you can open a regular high street bank account.

Leave the proceeds of the house sale in your Canadian bank until you’re ready to start transferring the money across.

At that point you can decide:
1. whether to do it via Wise and whether you want to do it in one go or in dribs and drabs.
OR
2. whether to follow Pulaski’s advice and ask your Canadian bank for the dealing desk rate and get them to send the money direct to your newly opened (non-Wise) UK bank account.

You seem reluctant to open a Wise account. Not sure why. It’s fairly painless.

tdrinker

Banker's draft is easy, but what currency will it be in?

GBP, so CAD was converted to GBP by your bank? What exchange rate is the bank offering (can you negotiate this?)? You can ask them the exchange rate offered if you were making the transaction today and and compare to Wise's exchange rate. Any other fees?

Or CAD, and the UK bank will convert to GBP? In this case, you won't know the exchange rate or any fees.

One thing's certain - unless you get the bank's dealing desk exchange rate rather than their standard rate, you're going to pay a hefty price for using the banker's draft. One or other bank, however, will make a good profit out of you.

Wise is easy to use, but unfamiliar to you which may be a barrier. Do you know anyone overseas you could send a small amount to via Wise to become familiar with its operation? If you do use Wise for the house sale money, make the initial transfer a small amount so you are sure you have set up the IBAN correctly and understand the process.

durham_lad

I agree with the posters above above using Wise and the exchange rate rate your bank will charge you to have a GBP bankers draft. If you have a sterling denominated account you don’t even need to worry about IBAN numbers, you just need to know the sort code and account number of the UK bank you are sending money to. Transferring money between UK banks is unbelievably easy and fast as you will discover once you are here. For example, this week or next our new car will arrive at the dealer and to pay for it I will move £20k into our checking account, then at the dealer will use my banking app to pay him, takes seconds. To set up a payee the first time you enter their name, sort code and account number and the app checks the details and should come back with “exact match”. After the first payment the payee is set up and no need to enter account numbers after that.

if you really do not want to want to open a Wise account then take a bit of cash over to open a bank account and once open then you can transfer money using one of the forex companies, including Wise - you do not have to have a Wise account to send money, it just makes it so much easier.

bats

I haven't said that I don't want to open a Wise account, I asked if it were necessary.
Many many thanks to those of you who replied in a non patronising manner.

tdrinker

I don't read any replies as patronising, and I'm sure none of them are meant as such. Posters are advising from personal experience, e.g. when I opened an overseas bank account I funded it via Wise, and sent a small initial amount to test the system because it was new to me and lest I made an input error. What's missing is anyone offering advice from personal experience on using a forex company, although I've seen some discussion / recommendations in recent threads on funds moved between Australia and the UK, from memory.

Pulaski

I am not sure who you think has been patronizing, as I don't see it, but I may be guilty of "over explaining", and providing numerical examples, and I do that for two reasons: [1] I don't know how much someone asking a question already knows, and don't want to assume that what is obvious to me given my qualifications and experience is necessarily obvious to other people with their background, and [2] There are many more people who read BE posts/ threads than who participate, or who even have registered as a BE member, so I try to give as complete an answer as possible, to answer possible additional questions that readers may not want, or be able (without registering as a BE member) to ask.

Helen1964

Jesus wept.