Jim San

We have just put in an offer for a property in Portugal (very exciting and scary time!). If it all goes through and they accept our offer ?!? I wondered if anyone had any advice in the best way of paying from GB to Euro with the least lost in conversation currency etc. Forgive the question, although I feel I have read everything going I am still very much starting out on my journey.

Alan PT

If you are planning to move permanently then it makes sense to get a Portuguese bank account at some point, but start off with one of these, it'll let you convert currencies and pay bills etc without any problem and at very low cost: https://wise.com/gb/multi-currency-account/

Jim San

Thanks Alan... long term plan is retire in Portugal, but for the next 10years it will be a second home with main residency in the UK.

Alan PT

In that case, Wise should be OK as a main account, you should be able to pay the bills, set up direct debits, take out cash etc no problem.

But you might find it useful to have a Portuguese account as well, so you can use Multibanco payments, they are quite convenient for some things and you also might still run into some places who only accept Multibanco or cash. If you need a Portuguese account (and you are happy enough with an online bank, with just a small number of face to face branches in shopping centres), go for Activobank: https://www.activobank.pt/en/

No account fees, online banking in English, everything works well and helpful staff if you do have any problem

Rambling archer

Hello Jim, - one thing you will need for any transaction in Portugal, be it paying your "Council Rates" - ie IMI - any other tax-related things, etc etc, even paying your electric and water bills ..... is the NIF number which you get from the Financas office. It does not take long to do and at least the offices are back to operating over the counter after Covid. So presuming you will come to PT to finalise the purchase you can plan to do it then. Your Estate Agent or Lawyer will be able to help and you can do it as a non-resident of Portugal giving a UK address to avoid becoming Tax Resident by mistake. The Financas will also send to the address you give them a very special code (in a letter in the post) which you use to log into their internet Portal which gives you access to all sorts of useful things tax-wise.
If you do decide to have a Portuguese bank account you will also need to give the bank the NIF number and also make sure you do the account as non-resident too - note that charges may be slightly higher.
When your ten years are up it is very easy to then register once you become resident at both the bank and the Tax office as resident, rather than non-resident. Your main problem then will actually be becoming Resident with Visa etc etc since Brexit but who knows 10 years from here things may have improved!!

Jim San

Thank you both.. I really appreciate your time in responding.

Andyj100

A friend's father recently transferred the proceeds of the sale of a house in France to the UK, and used Wise..I understand the rate was good, but things got bogged down with compliance issues, so there were delays. My (offshore) bank will negotiate a rate for bigger transfers that is a lot better than the standard published rates, and there are currency brokers.

Alan PT

I used to use a couple of currency brokers, but I switched to Wise as I found it cheaper and more transparent - they tell you the live mid-market rate and their fee. Banks usually hide most of their charges by loading the exchange rate significantly in their favour (which is why they can then afford to negotiate that rate on larger amounts)

I had a nightmare with one of the well known currency brokers demanding daft amounts of compliance paperwork (and then forgetting about it, so that I had to remind them they already had it when they demanded it again when I wanted to send the money I had converted!).

I have personally never had any problem with Wise and when we bought our house in Portugal we sent half the money from our Portuguese bank and half from Wise. The money Wise arrived within hours, the money from the Portuguese bank (even with a manual "special priority" order fee) arrived a day late. Fortunately the seller was understanding!

I recommend Wise because I have used it a lot and find it excellent, that's my personal experience, but of course any service will have problems sometimes, If you want to look at comparable services, check out Monzo and Revolut (though I'd personally never use Revolut because of their staff treatment)

Jim San

thank you so much… really helpful

Pulaski

Almost all banks, including Barclay's, Lloyds, HSBC, and NatWest, will give a better rate for large transfers, probably starting around £50,000, with the larger the amount, the better the rate, with the very best rate likely only available for £1million+. You need to ask them for "a dealing desk rate" (use those words), and you will get something linked to a real-time market rate, so the quote will only be good for a short time, probably no more than a couple of minutes.

BTW the dealing desk rates are a lot better than the published *tourist* rates used for exchanging money for your holiday spending money, but not much different from the market rates published on market data pages and the financial pages of newspapers, except to the extent that the rates have moved since the data was reported. .... Go to a real-time data web site (typically reporting data from 15 minutes ago) and keep hitting the refresh button, and you can see the rates fluctuate. 😀

SgtTroy

Open an account with CGD, you can do that at their London branch, or at any branch in Portugal.
Their exchange rate used to be ECB exchange rate for the previous day, or something really close to it. The rate is fixed for all transfers made during that day, which normally is not a big deal, unless there was a referendum the day before.
As CGD account now comes with a charge, once you move to PT, you may switch to another bank.

For today, for example, the exchange rate was 1.21139 for all transfers up to 3pm, and I doubt that wise could beat that.

https://www.cgd.pt/Site/Live-in-Port...-transfer.aspx

forex at the moment is 1.2052 GBPEUR

Pulaski

But in the second and third decimal places you are going to be at the mercy of the continuous volatility of the currency markets, and it is interesting to me that a bank would offer a fixed rate for the entire following day. Therefore I suspect that in the event of a sharp intra-day movement in the rates then the "fixed rate for the day" will likely be reset.

FWIW the exchange rate link you provided did show that there was, during the day today, a time when there was, at least at the published "mid rate", a better rate than CGD is offering - the rate was as high as €1.2191, which leaves room for Wise to beat the CGD rate at that rate, as that rate less Wise's 0.5% would be €1.2130.

SgtTroy

24 June 2016.
Market rate 1.20 or so, down 0.10 from the previous day.
CGD rate 1.30 or so, they didn't change it for the whole day.

CGD service is automatic, free, and it works in both directions and for both currencies, as there is a significant number of PT expats who live in the UK.
They have separate rates for buying and selling currency, the above is just for online transfers.

P.S. wise have £3 or so transfer fee, which should be deducted from the sum of the exchanged funds

Pulaski

Almost all banks and currency exchangers do, it's called the "spread". Wise is an outlier, which purports to exchange at the mid-rate, but then charges a ½% fee.

Many banks charge a spread and a fee, but others have (IMO) the near-fraudulent habit of advertising that they "charge no fees", but have a relatively wide spread. The only true measure of the cost of exchange, say from GBP, is to look at how many dollars/ euros/ kwacha, etc. you will have at the end of the day, for the pound sterling sum that you are looking to exchange.

Alan PT

Wise will also reduce their fee for larger amounts, down to .3% and below. You can see this on their website, it's transparent, that's why I like it

I'm sure that there will be points where the artificial fix from CGD will beat Wise and CGD may even lose money on it. But the CGD account has a fee, so they probaly make it backl off that and off the other transfers where their artificial fix makes them money.

I'm not saying CGD is a bad option, they are better than many other banks. But why open an account with them and pay fees when most of the time Wise will match or beat them and they still give good rates on smaller regular transfers (like pension payments)?