Transferring money regularly internationally

[matt21]

Hi folks

What is the best way (and cheapest) to transfer money between a US and UK bank account.

Currently living in both countries, I get paid in GBP, girlfriend in USD, so is difficult to transfer money

Ideally something like Venmo but that doesn’t work internationally. Would rather not pay commission

Thanks!

[shopper150]

Revolut

[Overall D]

I've been using Transferwise for transfers between my UK pound sterling and continental euro accounts for a couple of years, yet to find a better way. Takes literally seconds too.

My eldest has recently opened a Revolut account and soon got funds frozen, still trying to get any sense from the useless support there. They don't have a phone line and are slow to respond to emails.

[GR_TVR]

Overall D said:

I've been using Transferwise for transfers between my UK pound sterling and continental euro accounts for a couple of years, yet to find a better way. Takes literally seconds too.

My eldest has recently opened a Revolut account and soon got funds frozen, still trying to get any sense from the useless support there. They don't have a phone line and are slow to respond to emails.

This - I have found Revolut incredibly frustrating. Constantly freeze funds, impossible to get any meaningful support via chat and you just get passed on to another person and have to start all over again.
In the end issues weren't resolved and money got returned to sender. Going to try Transferwise next...

[Gibbo998]

I transfer a monthly amount from my U.K. bank to my Thai account for living expenses.
My bank charges me a set fee of £20 and the rate of exchange is usually about 1 baht worse than the currency transfer houses.

Since Brexit and the devaluing of the GBP, I have studied options more closely.

I have used Transfer Wise for the last three months and the service and rate they offer is outstanding.

My bank would take up to a week to get funds across, and other transfer houses would be similar.

My last transfer was done at 7 in the morning Thai time and the funds received 15 minutes later.

The exchange rate was as good as any published rate, so an absolute ‘thumbs up ‘ from me.

[DonkeyApple]

Citibank allow you to have proper USD and GBPcurrent accounts so that’s the general spending side sorted. You then need a cost effective way to cross regular, modest GBP amounts to USD. Transferwise is much more transparent than Revolut who mask the way in which they make the transfers which means like all their business it’s a bit shonky and charges more than you are lead to believe.

[BaldOldMan]

I regularly use Revolut for GBP - EUR transfers.

First 10k is easy - above that you need to provide proof of source of funds to get a higher limit, but once done, I've not had an issue in the last 2+ years.

[Mezger]

+1 for Transferwise, have been using their service for a year and they are superb, apart from their little outage the other week (think that was AWS related though). Rate is very competitive vs FX broker or Banks.

[DonkeyApple]

BaldOldMan said:

I regularly use Revolut for GBP - EUR transfers.

First 10k is easy - above that you need to provide proof of source of funds to get a higher limit, but once done, I've not had an issue in the last 2+ years.

That’s their USP, to make it as easy as possible normally via aggressive interpretation of legislation but also by the subtle muddying of the waters in terms of product description.

For example, what price are you executing at? Their answer has historically been to reply that you will be trading at the mid but with physical FX there is no exchange, not centralised price so ‘mid’ is a meaningless term to an FX broker such as myself.

Physical fx also has next to no regulation so there are no best ex rules, no retail client protections etc. What you will always notice in the small print of physical FX brokers is that the party that executes the transaction is a separate legal entity to the one that inboards the client.

In short it’s a really scuzzy market. Probably the last retail facing financial market that remains operate on the complete bandit rules of the 80s. In fact, physical gold is the other main one. It’s why when a retail broker gets banned from their industry the physical fx and gold market is their final call before becoming a minicab driver.

On physical fx Incould quote you an amazing market beating spread, I could offer you the cheapest comm going and I could still rip you a new one all day long and have you paying me enormous comms without you noticing. That’s what is so lucrative about it, almost no client understands how it really works and the industry, like any good magician, gets them looking at the left hand while the right hand is doing the deal.

Revolut is absolutely fine for things like holiday money and small one offs but for regular, larger amounts it’s more prudent to find a service that is well, a little bit less Russian shall we say.

Transferwise has a more transparent pricing policy but neither offer an actual protection of funds as they are just EMIs which means for bigger sums that would be an issue of ‘lost’ then neither are appropriate but for regular salary sized transfers it’s the clarity of the Transferwise mechanism that is arguably more favourable than the ‘magic’ of others.

[anonymous-user]

DonkeyApple said:

Revolut is absolutely fine for things like holiday money and small one offs but for regular, larger amounts it’s more prudent to find a service that is well, a little bit less Russian shall we say.

I agree.

In terms of another suggestion for the OP, I use Amex International Payments service,

Once you are signed up they have a decent online system to use - the rate is 0.16% from the interbank rate with no transaction fees.

They also give you a small side benefit of 1 Amex Membership Reward point per £20 processed on their platform.

From my research, the rate is reasonably competitive, but you have the reassurance of dealing with Amex.

[BaldOldMan]

DonkeyApple said:

For example, what price are you executing at? Their answer has historically been to reply that you will be trading at the mid but with physical FX there is no exchange, not centralised price so ‘mid’ is a meaningless term to an FX broker such as myself.

In the case of Revolut, mid seems to mean that they offer the same price either way - I've only done it with relatively low values as a demo, but I can change & then change back and get the same amount back.

Rate is transparent before execution

Rate is also live during UK working hours (I think) & somewhat stale over weekends

I've transferred some significant sums, but would not leave a large balance there for any length off time.....

[DonkeyApple]

Yup, the mid is the centre point between the bid and offer. But there is no centralised exchange from which a bid and offer is derived and that’s the start of the fun and games.

For example, if they used an interbank spread and chose the middle of that then they would lose money on every transaction, in each direction. Plus, everyone would open an account and arb them into bankruptcy so that tells us that their ‘mid’ is something else entirely, something that allows them to make money. That money is obviously coming from the consumer but the consumer doesn’t know how much so can have no idea as to whether it is a fair commission or an exhorbitant one.

Opacity always means higher comms. It’s why regulated markets don’t permit opacity.

This doesn’t really matter for one off or small transactions but for example, if it’s your monthly salary, who ever opts to pay more tax than they need to?

[BaldOldMan]

I have no idea how much money they make per transaction (if any) - but they are still making a loss overall

https://www.cnbc.com/2019/10/01/revoluts-losses-do...

Are you saying that Revolut are more opaque than transfer wise or others in the market ?

Their rate is clear before execution of the trade - so you can compare with anyone else that is publishing

[anonymous-user]

BaldOldMan said:

In the case of Revolut, mid seems to mean that they offer the same price either way - I've only done it with relatively low values as a demo, but I can change & then change back and get the same amount back.

It's likely they know this is a test people will perform to try and assess the platform's value for money. So they just set up a specific rule to ensure it appears this way.

Rather like when VW cars knew when an emissions test was being conducted by measuring steering wheel movements and then applying a separate engine map.

I'd compare the rate you are receiving to the interbank rate at the same moment you get a spot rate from the app. Then you can easily see the spread you are paying.

[BaldOldMan]

Is there a good free source for spot FX rates ? - the only ones I can find are 15 min delayed

FWIW - Yahoo have the GBP/EUR as 1.1655 right now (15 min delayed) - Revolut is bouncing around between 1.1654 & 1.656 so seems pretty close.

I'm not particularly trying to advocate Revolut, but I'm happily using them & want to ensure there isn't a significantly better option.

[DonkeyApple]

BaldOldMan said:

Is there a good free source for spot FX rates ? - the only ones I can find are 15 min delayed

FWIW - Yahoo have the GBP/EUR as 1.1655 right now (15 min delayed) - Revolut is bouncing around between 1.1654 & 1.656 so seems pretty close.

I'm not particularly trying to advocate Revolut, but I'm happily using them & want to ensure there isn't a significantly better option.

This is the delight of FX. There is no easy way when off a trading desk to know the fair price. Spot is basically an amalgamation of a number of quoting banks two way prices. Different destinations can have different spot rates because they contract with different liquidity providers.

From a retail perspective, I always suggest using IG’s two way price. The reason for this is that I know that they don’t manipulate the quote that they publish to their website or demo feeds. It’s the same quote that is piped to their live platforms. I also know that they don’t manipulate that quote based on whether they think you are buying or selling (ever noticed that most physical brokers basically know which direction you are going to trade before you trade? That’s a pretty profitable bit of information when you think about it” if you can make up your own pricing!on a product). I also know where their feed is bought in from and which banks and liquidity providers make up the bid and offer. So their website live quote is about as good as you will get.

It will also show you that the price simply doesn’t sit still so if a broker has a system that swaps you back at the same rate then that categorically confirms that price manipulation is taking place specifically targeting on a per client basis.

With regards to the loss making bit, if they were loss making on the physical fx then they would have been arbed into bankruptcy. They are a loss making business but that’s because they pay more to acquire a customer than that customer will ever generate in commission. A bit like Nutmeg and the challenger banks like Starling, Tide etc. They are just using investor capital to buy market share hoping to reach a critical mass that allows them to be either profitable or get bought out. But that raises another aspect, you don’t want to have any meaningful amounts either in transit or on deposit with a loss making firm that offers zero protection to client capital. I’ve seen how bail ins work when there are Russians on the shareholder register.

[BaldOldMan]

Thank you for the explanation - it all makes sense - I guess the fact that I look for a GBP/EUR quote tells you which way I'm moving my money.....

The GBP/EUR rate on Revolut look very close to IG right now (the same to 3 decimal places and close on the 4th), but I appreciate the advice & have been keen to have a good cross reference to keep checking - https://www.ig.com/uk/forex/markets-forex

I somewhat understand and accept the risk vs convenience trade off and try to move larger sums through & out again back to back and only keep my beer money on there as a balance.

Thanks for taking the time to explain.

[RicksAlfas]

First Direct works well:

https://www1.firstdirect.com/travel-and-internatio...

[BaldOldMan]

RicksAlfas said:

First Direct works well

Thanks - will give them a try

I just had a quick look - seems a good bit of faffing and looks like you won't see a rate until you have entered everything. There also seems to be plenty of disclaimers about fees that might get charged by intermediaries or receiving banks - so not clear who is going the FX.

When I have a bit more time I will try a transfer & see what it costs me

Revolut - I move money using my switch card or bank transfer - I see my GBP balance - I then see the rate & do the FX - I now have an updated EUR balance - I initiate a transfer to my EUR account - no fees anywhere - the FX rate seems reasonable

I'm trading some security for a much more convenient transaction.

[essayer]

We used Hifx (now XE) for years, always a decent rate, and same day for USD/GBP