Sendmoneyaustralia.com has been designed to help expatriates and small businesses in Australia, or Aussies abroad, with their international money transfers. The market can be confusing and there’s a great number of foreign exchange companies to choose from. We review their services, compare them, and help you get the most bang for your Aussie buck. Use the table below to get an indication of the saving you can achieve through using international money transfer companies over banks.
Our aim? Help you send money abroad from Australia – for cheap!
|Bank / FX Firm||Money sent||Money received incl. fees||Duration|
|ANZ||AU $10,000||£4,770||2-3 working days|
|CBA||AU $10,000||£4,636||2-3 working days|
|Westpac||AU $10,000||£4,677||2-3 working days|
|Bendigo||AU $10,000||£4,718||2-3 working days|
|NAB||AU $10,000||£4,693||2-3 working days|
|FX Provider||AU $10,000||£4,900||2-3 working days|
Total saving: FX provider’s fees for this transaction were £31, or 0.5% of the transaction. Westpac’s fees were £364, or just over 5%. The differences are staggering and mind-blowing. The differences between the best banks for international money transfer and the worst money transfer companies in Australia may be insignificant, but the best money transfer companies in Australia can nowadays offer rates of as low as 0.15% (WorldFirst, starting from August 2019, is offering 0.15% for large transfers. That’s 33 times cheaper than a bank charging 5% FX markup).
How does the process go with these money companies? in short, you will book a transfer through an online platform or telephone, and then, have to fund that transaction. You do that by paying domestically in AUD to a local bank in Australia (or, if you are sending To Australia, domestically from wherever you send). The money will be withheld in a segregated account which the company has no access to, besides for international money transfer purposes.
WorldFirst is one of the most advanced and best known foreign exchange companies globally, operating for more than 20 years, and owned by one of the world’s largest conglomerates (Ant Financial). It has changed its business model to ULTRA SHARP MARGINS of 0.15% to 0.5%, which can’t be beaten. For large transfers, they are even remarkably cheaper than Wise.com. You can view a Wise vs OFX comparison here.
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When it comes to transferring money overseas, clients have plenty of options. The advent of non-bank currency transfers has allowed a new clique of companies to emerge and offer currency transfers abroad. Companies such as the ones listed above are examples of non-bank entities that can potentially undercut banks when it comes to pricing. Newly developed platforms such as CurrencyFair and Wise are pushing the boundaries still further by offering an exchange-style service helping to further reduce dealing spreads and transaction costs. The rather opaque landscape of Foreign Exchange (FX) is now littered with a range of money transfer services for various clients with differing requirements — but just how competitive (or not) are the banks in the first place? We decided to run a brief money transfer comparison of the major Australian and UK banks, to see how they stack up against each other, as well as against the horde of boutique currency transfer companies that have appeared on the scene over the past 10 years.
|Bank||Bid||Ask||Spread||Online Fee||Branch Fee||Phone||Currencies|
|ANZ||0.5105||0.477||6.56%||$18||$32||$32||60 countries & 30 currencies|
|CBA||0.5137||0.4636||9.75%||$22||$40||$30||200 countries & 30 currencies|
|NAB||0.5091||0.4693||7.81%||$22||$30||$22||200 countries & 30 currencies|
The most glaring observation is the size of the dealing spreads. On average, Australian banks are quoting a spread of around 860 pips around the current spot price. In the example above, with a spot price of 0.49 the banks routinely add around 250 pips onto either side of the current price when doing spot transactions. For our example, we used a transaction size of $10,000 AUD transferring to the UK at the best possible spot rate. The bank that was able to offer the most competitive rate to an Australian client sending money to the UK was Westpac with a price of £0.514.
Here is a table of what a $10,000 transfer to the UK would look like, at the other end:
|Bank / FX Firm||Money sent||Money received incl. fees||Duration|
|ANZ||AU $10,000||£4,738||2-3 working days|
|CBA||AU $10,000||£4,596||2-3 working days|
|Westpac||AU $10,000||£4,645||2-3 working days|
|Bendigo||AU $10,000||£4,688||2-3 working days|
|NAB||AU $10,000||£4,663||2-3 working days|
ANZ offered the best conversion rate and because of that, even after deducting the fees, it was the best to transfer AUD to GBP.
One of the most important aspects of transferring large amounts of money abroad from Australia, or to Australia, is the Australian Dollar rate at that time and its future prospects. Transferring currency at the right timing can, eventually, be more important than the direct fees paid on any FX transaction. As currencies shift between 2-5% per year against their pairings, selling at the top and buying at the bottom can have a huge impact on one’s financial situation.
This is why we compare money transfer companies and have created these general guidelines on how we view the Australian economy in 2019. It is also important that you will discuss this topic with the foreign exchange broker you have opted to use. All companies recommended by us have vast staff with experts.
Similarly to another hot industry in Australia of small business financing, not only do banks compete on pricing, but they also compete on service. All the banks surveyed offered very similar additional services such as online functionality, wide range of destination countries and seamless integration with other services offered by the bank. All the banks strongly encourage new customers to open a bank account with the bank in order to cross-sell other services and reduce administrative functions such as repeat requests for proof of identity and other KYC details. To incentivise greater use of their own service as opposed to a rival bank, a variety of incentives are offered including better dealing spreads, lower transaction fees and insurance. The key point to remember for customers is they will get nothing unless they ask and negotiate. If a customer has an existing mortgage or current account with the bank, better transaction conditions are likely to be considered and accepted by any of the large banks. That’s why is important to compare money transfer services and choose the one that offers the best rates.
Banks have vastly different operational objectives which mean they cannot possibly service the millions of their clients with dedicated customer support and personalised account managers. They also cannot offer preferential rates to all customers. Banks rely on the fact that customers with small transaction sizes will simply “avoid the hassle” of opening a new account with an alternative provider when the bank takes care of everything including insurance, directly from the customer’s standard bank account. This feature is what is known as the ‘default option’ for customers and banks, therefore, leave their headline rates fairly wide and profitable. For large corporate customers, repeat transactions and forward transactions, banks offer a dazzling array of various perks and cost-saving features that aims to retain the larger volume business. For reasonably small one-off transactions such as $10,000, banks will only offer a best-rate. But if the transactions are the first of a series, the bank may consider waiving the transaction fee or reducing it for future deals. For large transfers or transfers done by small businesses, banks tend to provide a more engaged service which tends to be charged for as part of the company’s business account with the bank. Also, for large one-off transfers, banks will always be flexible with their advertised rates and all their transaction fees. The bottom line in FX, is that everything is negotiable — but there are expectations on both sides of the equation. Doing a money transfer comparison beforehand is important.
Ultimately, some people will opt for boutique FX companies in the hope of obtaining better-dealing spreads and reducing transaction costs. FX companies are now famous for offering around 2%+ in savings on any transaction which can add up to a huge amount of money for anyone doing several currency transactions per year. To sign up with an FX company, Australian customers merely need a current ID and proof of address as part of the company’s account opening procedure. For businesses, a more detailed set of documentation is required including incorporation certificates and Director approval for account opening, in addition to the standard ID and address documents. Given the relatively low level of financial services regulations in foreign exchange, customers are able to open an account and initiate a currency transaction on the same day. Currency companies are not permitted to hold client money which means they merely redirect or route the funds from the customer to the intermediary that will be doing the actual conversion (which is usually a bank). Currency companies are able to obtain much better rates from banks or other ‘liquidity providers’ than individuals because of aggregation and scale. By having a competitive rate for a large sum with a bank, currency companies then dole out smaller transaction sizes at higher rates to make their profit. One last important note is that things are generally simple and straightforward in low-risk regulatory countries and major currencies such as the US and Aussie dollars, British pounds and Euros. But when it comes to exchanging Roubles, Brazilian Reals, South African Rand or Indian Rupees, there can be other important considerations including longer delivery times, higher bank charges at the destination country, greater KYC checks and most obviously, wider dealing spreads — although everything is negotiable.
A quick money transfer comparison check of the same $10,000 transfer to the UK — only via currency companies, shows the savings that are possible. Here is CurrencyFair’s best personal offer for September 22nd:
Compared to the best bank offer from Bendigo (£5,576.22), the best online offer we could find was CurrencyFair; offering £5,829, and thereby creating a saving of £253 or 4.5%. If we compare the worst bank offering to the money transfer service we get to more than £325 or 5.8% saving. CurrencyFair was by no means the only ‘best offer’ FX company. Others names like Compass Markets, HiFX, TorFX and WorldFirst were all able to beat what banks can offer comfortably and generating savings of ~4% each. If you are buying a house abroad for $250,000 – that’s a saving of $11,250. If you are going on holiday next week and taking $5,000 — that’s a saving of $225. The decision is yours. Note: If you are intending to the do currency transfer the other way — from the UK to Australia — the UK banks are similarly priced and conditioned as their Australian counterparts. A commonwealth connection means UK/Australia contain similar financial services regulations. Intriguingly, the UK’s five biggest banks such as Barclays, HSBC, Lloyds, Natwest and RBS — do not publish their personal FX rates in great detail on their websites, whereas Australian banks have dedicated platforms advising on both bid/ask prices and rate differences subject to transfer amount.
Many countries have won the title “The land of infinite opportunities” over the years, but Australia has definitely demonstrated over time that it’s a terrific place to live in. With a strong economy ranking 12th in the world in GDP and an advanced social juridical system in place, you can expect wonderful things if you move Down Under (read about immigration to Australia). Stunning views, incredible beaches, top 15 educational system, friendly people, beautiful ladies, and it’s easy to get a visa if you are from other commonwealth countries. (read more about moving to Australia, or visa to Australia here). Expats who live in Australia in one of 5 large expat communities in the country, need to move money internationally between their domestic and overseas bank accounts on a regular basis and can save plenty of money using the right providers.
The Australian market has been one of the most lucrative, and profitable, markets over the past 15 years, and in particular with real estate, climbing about 6% year-by-year since the ’90s. Another popular investment opportunity is the stock market which made an incredible leap forward over the past 5 years. There are a lot of clients who invest in Australia, as well as a significant number of Australians investing abroad. Moving large sums of money through commercial FX companies is a great idea – the larger the transaction is, the better currency exchange rate you can negotiate. Additional Audiences: Business clients can look at our corporate fx & hedging guide.
It is estimated there are 1,000,000 Aussies living abroad. About 50% live in Europe in various Eurozone countries, and 30% of them resides in the UK and in the USA. The rest are spread across the rest of the world – from nearby NZ to far places like Israel, Dubai and China. What’s common between all Australians who live abroad is the fact a significant amount of their income is transferred into Australia, or a part of their pension/rent is sent from Australia to where they currently reside. This regular monthly transfer would cost more than AU$250 on average and can be reduced by more than 50%.
Ready to Send Money Abroad or Repatriate Funds from Abroad?View Recommended Companies
Signing up with a money transfer company might take a little bit of time and be not as straightforward and quick as we would like it to be. Of course, that if you are moving large volumes and/or trading frequently, it’s worth your hassle, but if you aren’t (or in a rush to transfer) you can consider doing it through the bank.
Here is the process of transferring or repatriating money with FX services:
Limitations: Currency brokerages, or Foreign Exchange firms, are more specialised towards large transfers. In fact, there are transfer limits with each of the companies. With Currency Solutions, the minimum transfer amount is AUD $5,000, but Currencies Direct are more flexible and transfer also as little as AUD $100. There is no upper limit at all, which means you can transact hundreds of thousands through their online platform or telephone.
Ready to Send Money Abroad or Repatriate Funds from Abroad?View Recommended Companies