Hacks for transferring money in and out of Europe

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  • International money transfers still riddled with fees and limitations
  • Azimo, TorFX, TransferWise and WorldFirst offer an alternative

While there’s no doubting the fact that the international money transfers industry has undergone a major boom over the last two decades, there are still some issues that people wanting to make cross-border payments must contend with. Like the issue of whether the money transfer company you’re thinking of will really work for your specific requirements.

To put it bluntly, if it doesn’t support the currency of your country of residence or your destination country – and therefore doesn’t support the currencies you want to transfer – you’ll fall at the first hurdle. Here’s a quick guide to what will work for what purpose, with moving money in and out of Europe as our example.

For the American market only, Xoom and Remitly are reliable alternatives to one another. But US residents wanting to send money to Europe need to dig beneath the surface. Remitly will accept customers from Britain, but not from the rest of Europe, while Xoom confines itself to customers from the US only.

Thankfully, there are more strings to the remittance industry’s bow. Prominent cross-border payments companies that serve the European market include market leaders Azimo, TorFX, TransferWise, WorldFirst, CurrencyFair and HiFX. Even so, this is just the beginning. The next step is to factor in the costs of money transfers.

Several cross-border payments firms claim they don’t charge any fees. It is probably wise to remain sceptical of this claim. Some will simply give with one hand while taking with the other.

It is important to look at the exchange rates on offer whenever you see “no fees”. If the absence of fees is compensated for by unfavourable exchange rates, you haven’t landed the great deal you thought you had. A quick hack to working out which company ranks better on the cost front is to calculate how much money the party on the receiving end of the transfer will actually get.

Bear in mind that most international payments will be affected by how much you want to send, your destination country, the payment method you’ve chosen and the transfer method.

Returning to the example of money transfers in and out of Europe, provided the transfers occur within the borders of SEPA (Single Euro Payments Area), your recipient’s bank should receive payment in one to two working days. For banks in countries outside Europe, you can expect that interval to climb to between two and seven working days, depending on the money transfers firm you’ve chosen, the destination country and the bank receiving the payment.

In the past, it was pioneering veterans of the trade like Western Union and MoneyGram that enabled people to transfer cash to various pick-up points. But today, new upstarts are joining the market, with companies like Azimo and WorldRemit providing their own agent networks and granting customers even more cost-effective options for collecting money from physical locations. And to cap it all, these transfers are virtually instantaneous.

The long and the short of it is that no single international money transfers firm will work equally well for all because consumer requirements inevitably vary. But keep an eye on the points we’ve flagged up here (exchange rates, fees, processing times and transfer methods) and you should find the one that suits your purposes.

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