It can be a tricky act to transfer money, especially large amounts of money. Fees are the biggest hurdle you have to overcome if you don’t want to throw money away. With the ‘global village’ that we live in, transferring sums of money is becoming more commonplace. The transfers are also becoming a lucrative business for banks and institutions. Ill-informed clients are some of their biggest gains. Don’t get caught up in that trap.
While using banks might be the first source people think of when preparing to transfer money, they may also be the most expensive. On top of the fees you have to pay to the bank for a wire transfer, there may also be hidden fees. These fees often are in the form of skewed currency exchange rates.
Some things to pay attention to are the bank’s exchange rates and their currency conversion fees. Every bank has its own exchange rate fee or currency conversion fee and these fees can be quite high. It’s up to the bank to decide these fees. Usually set as a percentage of the amount being converted and transferred, one must keep in mind that it doesn’t cost the bank more to transfer a large amount compared to a small amount. In other words, by using a percentage instead of a set fee, banks are reaping in profits based, basically, on a random number.
Exchange rates do not change with the size of a transfer, nor does the work involved. Using a percentage rate is just not fair to you. Keep this in mind as you consider what institution you will transfer your money through. Ask the questions and shop around for the best rates.
There are a number of companies opening up that provide a lower rate, compared to banks. As the number of these businesses increase, the tables are being turned in favour of you, the client. Competitive rates are great for people who need to transfer money frequently. These new businesses recognize a niche the banks have created and are taking advantage of new and expanding ways to transfer money globally.
Now is the time for those of us who need to make money transfers, whether they be small, recurring transfers or a large money transfer, such as for a house purchase, to be in control of how much they are willing to pay for that transfer. Its no longer just banks in the game.