How to send money ‘home’ without breaking the bank

Sending the proverbial ‘few bob’ back to Ireland is a staple of the emigrant experience but the internet and some innovation has solved some of the old problems, and created new ones. Claire McGreal explores the options.

In the old days, expats might be expected to support the family back in Ireland by sending home the few bob.
Times have changed and in our post-Celtic Tiger world there are a myriad of other reasons why someone might need to transfer money internationally either to,or from, Ireland.

Recent arrivals might be still paying off mortgages, loans or various bills in Ireland, while others are sending money home for special occasions.

So what is the cheapest, fastest and safest way to transfer money overseas?

Online banking transfer

Online banking has become part and parcel of our daily lives and most major banks will offer a facility to send money abroad as part of their web-based services.

The cost of sending an International Money Transfer (IMT) to an Irish bank account varies according to each bank.

For example Westpac charges $20, while Commonwealth customers pay $22. If you want to organise the transfer in the branch, it will cost you $30 with Westpac or $28 for Commonwealth customers, and $32 for non-customers.

If you want to trace or cancel an IMT you will also have to cough up between $20 and $40.

On the receivers end, AIB charges a standard €6.35 fee for incoming money transfers of more than €127.

Bank of Ireland charges the beneficiary a flat fee of €5 for receiving a payment in dollars.

If the payment is in euros, the charge depends on how much you receive (€5 for up to €130; €7.50 for up to €6,500 and €10 for amounts over €6,500).

Your money may have to pass through more than one bank en route to the beneficiary, so each bank may deduct a processing fee along the way. Some banks recommend sending a little extra money if a specific amount is required on the other end.

To send an IMT via online banking from an Australian Bank Account you will usually need:
• The bank code, name and address of the overseas bank you are transferring
• The beneficiary’s name, address and account number
• The amount and currency you wish to send.

You will also need an International Bank Account Number (IBAN) and a Bank Identification Code (BIC) or SWIFT address to send funds to an Irish account, which you can get online.

The standard exchange rate of the bank on the day you send an IMT will apply to your transfer, which usually takes between two and five working days.

Online banking transfers offer convenience at a price but watch those bank charges. Exchange rates also tend to be less attractive than elsewhere.

Western Union

An advantage of a Western Union (WU) ‘wire’ transfer is that your money can be picked up from any agent around the world within minutes. In general, the more money you send, the more value you get per payment. For example, transferring $500 to Ireland will cost you $50, while sending $1,000 will cost you $70 and so on.

The total amount you can send overseas online is $999.99, while any amount can be sent at an agent (certain requirements must be met for sending more than $10,000).

The recipient will have to go to an agent – generally a post office – to collect the funds.

Great network of agents but expensive if sending more than a couple of hundred dollars.

CurrencyFair

Set up in Dublin by two Aussies, an Irishman and a Welshman, CurrencyFair claims to be “the world’s first person to person online foreign exchange marketplace”. It’s a simple but ingenious idea.

CurrencyFair puts people who want to sell pounds, euros, dollars or whatever in touch with other people who want to buy them.

“What we’ve done is create a marketplace in which people can do business with each other. No banks involved. No middlemen in pinstripes. Just CurrencyFair, smoothing the process along,” the website declares.

There is a $4 fee to transfer money from a CurrencyFair account to an Irish bank account, or $10 if you need to rush it. As funds can be deposited into CurencyFair’s Australian or Irish accounts, the processing fees of international bank transfers are avoided.

It is easy to set up an online CurrencyFair account and all exchanges are 100 per cent anonymous. Live exchange rates are available online, and funds are exchanged at close to the interbank rate.

Users who match each other pay no commission, while the rate is set at around 0.5 per cent from the interbank rate, for those who need to exchange currency straight away. Transactions take around two working days and there are no limits on the amount of money that can be sent.

Director Seán Barrett says the company, which is regulated by the Financial Regulator in Ireland, was “designed for expats” … “whether it be for regular smaller payments like sending money home to pay bills or mortgages, to large amounts like sending funds from selling a foreign property or repatriating savings”.

Set up with expats in mind, Currency Fair may yet change the way foreign exchange works.

OzForex

Foreign exchange firm OzForex has been around since 1998 and is owned by Macquarie Bank. OzForex sets out to offer better exchange rates than the banks and caters for the expat market by allowing for a minimum transfer of about $200 (it is usually $2,000). A fee of $15 per transaction applies on amounts less than $10,000.

It is free to register, and once you do an agent will be in touch to deal with your transaction. When a deal is reached, you transfer your funds into one of OzForex’s Australian bank accounts (they have accounts with Westpac, NAB and ANZ), which they then move into your beneficiary’s account within two to three working days. OzForex also has euro accounts, so the international bank transfer fees are avoided.

Cheaper than the banks but watch the exchange rates.

Travelex Money Online

This service allows you to transfer money to any Visa cardholder overseas for $9.95. You must have a Visa card (debit or credit) to use the service, and the maximum amount you can send is $2,500.

You must also have online banking at the other end, in order to transfer the received funds from your Visa credit card directly into your current account, or to pay a bill. The foreign exchange rate will be quoted online when you apply, and you must pay the $9.95 transfer fee via Bpay within four hours.

Once your ID details have been verified, your money will be transferred within two to three working days. There is no recipient fee on the other end, and Travelex promises no hidden fees along the way.

Another handy idea but keep an eye on the exchange rates and your credit card balance. Would work well with a debit card so you’re not paying high interest on cash advances.