4 Reasons You Need to Rethink Your International Money Transfer Options
Australians are peripatetic people. The scale of international business transactions now taking place necessitates a forward-thinking strategy when it comes to international money transfers. Companies are increasingly engaged in international money transfers, and the costs of these transactions can cut into your profitability. On a personal level, international money transfer services are increasingly important when it comes to immigration-related issues, transferring money overseas, and repatriation of earnings etc. For all of these reasons, it’s important to rethink international money transfers.
- Banks Are Designed to Make As Much Money As Possible – avoid them for international money transfers
Banks are in the business of making money, lots of money. Most all of us already know that banks charge extortionary fees on overdraft facilities, loans, and other services that they provide to clients. What we don’t know about banks is that international money transfers (international payments) are often laden with many hidden charges. For example, the currency rates that banks charge are much higher than the standard market rates for those currency pairs. It has been said that banks can charge an additional 5% in extra charges on the total cost of the international money transfer. This may not be detrimental on a one-time transfer to/from Australia, but if you have a business making regular payments abroad this will cripple your operations.
- Services like Western Union and PayPal Are a No-No – avoid them for making international money transfers
Name recognition may be good for some things, but when it comes to international money transfers it’s important to understand that Western Union and PayPal are not your best options. They are certainly efficient with international transfers, but you pay a pretty penny for their services. PayPal has been increasing the costs of its services on international payments (incoming transfers) especially when they out not based in the US. First of all, the currency exchange rate that PayPal offers you is worse than the prevailing rate, and then they charge you additional fees on top of that. If you’re using a debit card or a credit card from PayPal, expect more fees. Unless you’re willing to whittle away all your Australian dollars, or foreign currency being converted into Australian dollars, avoid these options.
- Carefully Scrutinize Institutional Currency Brokers – avoid them for making international money transfers
Ever heard the term snake oil salesman? Many institutional brokers are pitch men for their companies. They will spin you a story just to get your money. A lot of the time, the rates that you will be offered are unfavourable, and you’re better off looking elsewhere. Many people mistakenly believe that it is beneficial to go through a human broker at a land-based office because they are reputable. However, you should do your homework before you simply part with money and paying exorbitant fees. Brokers could end up charging you just as much as money transfer services like Western Union and PayPal, perhaps even as much is banks.
- Consider Nonconventional Options – these are great for making international money transfers!
When you transfer money to Australia from abroad, as an expat, or a foreign business, or you are making payments abroad from Australia, you want to pay as little as possible in exchange rate fees, commissions, broker fees and hidden charges. Banks and traditional money transfer services are not the way to go. It’s important to compare Australian facing currency providers , and to evaluate them based on the services they offer and the costs entailed. There are many options available to you, many of them rank highly in terms of price, features, currency availability, reputation, and customer service. Ideally what you want is the best foreign exchange rate, zero fees, zero commissions, and personal guidance on currency exchange rates.