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Doug Nebeker ("Doug")
We get stung by the banks by about 2.8% every time we receive a foreign bank transfer (or wire transfer as you'd call them state-side :)
This is because they use an exchange rate that is worse than the mid-market rate, to take a slice from all foreign transfers. AFAIK, all banks do this.
So on a €10,000 EUR transfer incoming to my UK GBP account, I'm losing out on around £220. And there is a £10 fixed foreign transfer fee on top of that.
Now, this is less than I'd pay on a credit card transaction, but I'm keen to find out if there is a more cost-efficient way to receive foreign bank transfers.
I know there are various companies that exist exactly to get around this sort of thing, like TransferWise. But such service all require the sender to do something completely different from initiating a bank transfer. I want to make it as easy as possible for my customers (we only sell B2B), so ideally I'm looking for a service that allows customers to send money like to a 'normal' bank, but doesn't slice off a big percentage.
Anyone know of such a service?
Some companies specify that the sender has to pay all the transfer fees. I don't know how well this works in practise.
Friday, July 11, 2014
That is just the fixed-price fees though, not the 'dubious' exchange rate.
We specify that the sender pays their costs, and we pay ours at the receiving end. 99 times out of 100 this works.
I'm not too bothered about the fixed-price fees though - it's the big deviation from market exchange rates that's the big issue.
That bitcoin thing will never take off, not ever, eh Scott?
(but no, it wouldn't be suitable for OP at this time. Not mainstream enough yet)
Friday, July 11, 2014
Talk to your bank about opening non-sterling accounts to receive the payments. Foe example, even though you tend to bank in GBP, there's no reason you don't hold accounts denominated in EUR, USD, etc.
I did this with HSBC and they were happy to set it up. That way, you pay nothing to recieve the funds (maybe nominal charge, like any other transaction), batch up the funds and only pay the fees once per quarter, or whatever. You should also enjoy a slightly less unfavourable FX-rate, with bigger transactions.
Of course the banks will get you one way or another, as they charge a monthly fee to "maintain" the accounts, but in many cases this is less than you'd pay in transaction costs.
You'll pay of the order of £120 per year to have a USD account in the UK. For me it wasn't worth it.
UK business banking seems such a cesspool of crap service and rip-off charges, compared to personal banking. I don't know they've got away with it for so long.
Monday, July 14, 2014
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