ukguy

The interest rate UK banks are offering is poor, I get 2.8% gross but this drops to 1.3% gross in September so am looking to invest some funds in a South African bank where the rates are much more favourable.

To make an online transfer from £UK to RSA my bank charges a small fee but they also make 4% on the exchange rate they offer.

I was paying about 2% when changing a couple of thousand cash at a bank in Sandton but what about if I want to invest £70,000.

Anyone here have any experience in getting funds from a UK bank to a SA bank safely and without losing so much on the exchange rate?

dfjordan

I cant help you on the transfer of funds but would suggest you dont compare interest rates between different currencies, as any interest gain could be more than offset by a loss on exchange, and as you already know, there will always be a spread between the buy/sell rate, which in itself will probably eat up and gain on interest rates between Sterling and the Rand. A year ago, you only needed about R13.50 to buy a pound compared with R16.00 now. That's a fall of around 20%. OK, it could go the other way also, but just bear that in mind.

ukguy

You are right.

I suppose it is worth bearing in mind that the price quoted is mid price so although for instance the exchange rate is showing as R16.16 to the GBP my bank will offer me a lesser exchange rate and a small fee resulting in 5% ish charge.

When changing GBP to Rand in FNB they offer a higher exchange rate but charge a 1.9% commission so it works out nearly the same which ever way I do it.

ededed

Or, find someone in SA who you trust who needs to get money into the UK on a regular basis who can transfer money from his SA account to your SA account - and you transfer money from your UK account to his UK account in return - at a mutually agreed rate, and on agreed dates. Saving bank fees and the extreme disparity of buying and selling rates via bank transfers.

Me, for example.

ukguy

That is a very interesting idea deeded.

I have been in SA a week now and found an apartment to live in, got my furniture, DSTV and rental car.

Next week I plan to get connected to the internet and open a SA bank account.

I have enough cash to last me for this trip but if my residence permit application is successful I would be interested in looking at your suggestion.

ukguy

Put that idea on hold.

I went into 6 banks this morning and even though I had my passport, drivers license, birth certificate, NI number, NHS number, certified bank statements, credit card statements stamped by my bank, Police report, proof of funds from the sale of a UK property and much more with me they all told me even if I get my permanent residence permit I am still unable to open a bank account without payslips.

I am not working and am living off the funds from the sale of the property so do not and will not have payslips.

ededed

That's insane. I managed it - with Nedbank. You may need an employer to stand surety and show a letter of appointment but it can be done. Can't you even open a savings account with cash?

ukguy

No, I had R15000 I wanted to deposit, all I want is to get a debit card, no overdraft or credit card or anything fancy.

I would like to be able to transfer from a UK account to a SA account when needed or what we were discussing above.

In the end I deposited it into my friends account.

MartynK

This doesn't make much sense.

I don't know if visitors can open bank accounts in SA, but this should be easy enough to find out. Ask the attorney who is helping with your application for permanent residence?

Legally, you need proof of identity and proof of SA residential address. The first is usually covered by an SA ID document, but your passport will be fine. The second normally requires a copy of a utility bill or an invoice/account showing your home address in SA, and I think a copy of your lease should be acceptable. FNB also have a process which allows the owner/tenant of the property where you are staying to complete a form confirming that you live there, and giving their own particulars and proofs as above. None of your UK documents will help you in any of this though.

The payslip criterion is bizarre. I've never heard of it, and how do self employed people and the independently wealthy comply? Proof of income normally applies to higher status accounts and credit applications.

Let us know how you get on, and good luck!

not2old

does your rental agreement qualify you for one of these?

http://www.standardbank.co.za/portal...00c509600aRCRD

feelbritish

I am a citizen and was not allowed to open a bank account as I was not resident, would not even allow me to use my mom's address. I just wanted to leave money behind for my next holiday! Once you get your permanent residence I am sure they will allow you to open an account especially if you get a friend to go with you? Otherwise it is madness. You could go and work in a pub, open an account then resign! Other option open an HSBC account in UK and transfer funds to an investment there, they have a branch in Cape Town and Jhb

kiwibok

The best investment you can make is to keep your hard earned foreign currency out of SA.

ededed

True, but it does make living somewhat tricky with no income...

ukguy

Martyn, non residents used to be allowed to open a bank account in SA but I have been told by all the banks I went into that since the new FICA rules it is not allowed.

Even if I am granted the permanent residence permit I have been told that I will still need to show them payslips. I have explained that I am living off the proceeds from the sale of my property and wont have any payslips.

It's not just one or two banks that told me this but all I have been into, I also tried 3 more yesterday in a different mall with the same result.

not2old, thanks I will look into it.

fellbritish, that is a good suggestion. The helpful and knowledgeable guy in the foreign exchange booth told me that foreigners are no longer allowed to open a SA bank account. He said ABSA are owned by Barclays and suggested next time I am in the UK I could open a Barclays account and getting an ABSA account would be easier.

Kiwibok, the thing is the best interest rate I can get on my instant access savings is the UK 1.3% whereas here some banks offer 6% and over.

It is difficult to predict if the Rand will weaken or strengthen from here but right now I am happy to get R15+ to the £.

ededed

Here's a thought - why not get a friend or neighbor to open an account in their name and give you the debit card? Zero overdraft so no risk, and you can use it to deposit funds and earn interest until you have either PR or payslips.