Deciding to buy anything from overseas can seem like a minefield. This is compounded when you’re talking about big purchases, such as a new property. You want to make sure you get the most bang for your buck, but thanks to low exchange rates, unnecessarily high fees and a lack of flexible options, banks can often be the worst choice available. Here are five reasons to use an FX provider, rather than a traditional bank, when looking to send money overseas.
Improved exchange rates
Because banks see foreign exchange as a huge money-spinner, you’ll never get the best exchange rate. For a weekend in Paris that’s not a huge problem, but when it comes to paying for your new Spanish villa, it’s another story. FX providers like Currencies Direct guarantee to beat the banks when it comes to rates.
No hidden fees. No charges
Every time you transfer money overseas, the average UK bank will charge Â£25. Some even charge a receiving fee at the other end, which is often a percentage of the amount you’re transferring. Neither of these are necessities, hence the reason FX providers don’t charge either, which can lead to a significant saving when you’re dealing with high-value transactions.
Because FX providers only deal in foreign exchange requests they are experts at providing advice and support whenever you need it. Not every bank has a foreign exchange specialist working in the building, which can lead to confusion, a lack of clarity and, in the long run, money down the drain.
A bank could take five days to send money to a European country. That’s five days during which exchange rates can change dramatically, and the recipient might get impatient. By comparison, FX providers will usually complete the transaction within one or two days, which is a significant difference by any measurement.
FX providers offer a variety of options that most banks do not. Forward contracts allow you to fix an exchange rate for 12 months, protecting you against changes in the markets. Regular transfers can be organised like a direct debit, again with a fixed exchange rate. Spot contracts service one-off needs, and by using a rate watch you can agree an ideal exchange rate, and the moment the markets hit that rate, your money will be transferred.
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