Top 3 Money Transfer Providers for UK to Bulgaria

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Summary

Bulgaria has been a member of the European Union since January 2007, but is not a member of the Schengen Area or the single-currency eurozone at this time, though negotiations for its entry into the eurozone and eventual adoption of the euro (EUR) as the official currency are ongoing. Bulgaria maintains its official Bulgarian currency, the lev (BGN). Bulgaria’s central bank, the Bulgarian National Bank, does not currently impose any currency controls on the lev, and encourages resident and non-resident transactions for individuals and businesses. Bulgaria does not restrict international money transfers at this time.

Bulgaria’s money transfer regulations

Money transfers can be freely sent into and out of Bulgaria, although resident individuals and corporations are required to report any international transfers to or from other eurozone countries that exceed a value of EUR €10,000. Foreign exchange transactions above this level must be reported to the central bank by completing a customs declaration. Exporting over BGN 30,000 in cash requires that the sender provide a declaration to the authorities attesting to the source of the funds and appropriate documentation stating that the sender does not owe taxes. Currently, Bulgarian law requires that international payments over BGN 30,000 must be executed by bank transfer and must include the required documentation. Any international money transfer that is above BGN 100,000 is recorded by the Bulgarian National Bank and the commercial bank through which it was transacted.

Bulgaria’s economic background

Located at a strategic crossroads between Europe, the former Soviet Union, and the Middle East, Bulgaria has thriving business process outsourcing and information technology sectors, which have attracted a variety of US and foreign companies to set up service centers in the country. Bulgaria has historically been a stable ally of the US and is also an active member of the World Trade Organization (WTO) and the North Atlantic Treaty Organization (NATO).

The government of Bulgaria actively seeks foreign investment and offers a number of government incentives for new investments, along with low, flat income and corporate tax rates. Currently, the Bulgarian government does not place limits on the control of or foreign ownership of firms, and it does not screen or restrict foreign investment in Bulgarian firms. Furthermore, foreign firms are generally treated the same as Bulgarian firms, and foreign investors do not report any significant cases of discrimination. Bulgaria does not have any laws that authorize firms to limit the amount of foreign investment.

As a new member of the EU, Bulgaria is expected to receive EU funds through 2020 totaling approximately US$20bn. This money has been earmarked by the Bulgarian government to develop the country’s energy sector, technical and social infrastructure, public services, and agriculture, water, and environment sectors, with the goal of helping to improve the country’s investment environment. Inclusion in the EU has created new markets for Bulgarian goods and services. The cost of labor in Bulgaria is the lowest within the EU, and the country’s workforce is generally young and well-educated.

Although Bulgaria entered the European Union in 2007, it still has not converted over to use of the eurozone single currency, the euro. Due to the 2008 global financial crisis and the resulting eurozone crisis, Bulgaria has hesitated to fully convert to the euro. In order to join the euro’s single currency exchange and end its use of the lev, Bulgaria would need to meet five EU-mandated convergence criteria, one of which is to join the European exchange rate mechanism. Once Bulgaria joins the exchange rate mechanism, it is then a two-year path to adopt the euro. In early 2015, Bulgaria announced that it would enter discussions to join the euro’s single currency exchange, with preliminary plans to join the exchange rate mechanism by the end of 2018.

Bulgaria’s monetary and regulatory authority

Bulgaria’s central bank, the Bulgarian National Bank, oversees the country’s cash and electronic payments system and its domestic banking policies and transactions. Although Bulgaria has been a member of the European Union since 2007, it still uses its own currency, the Bulgarian lev.

Currency

The lev is the official currency of Bulgaria and is divided into 100 stotinki. The lev was introduced into circulation in 1881 with bronze coins worth 2, 5, and 20 stotinki, a silver 50 stotinki coin, and 1, 2, and 5 leva coins. Banknotes were introduced by the Bulgarian National Bank in 1885, worth 20 and 50 gold leva. After a number of currency releases over the years, the country released a new set of 1, 2, 5, 10, 20, and 50 stotinki in 1999. In 2002, a new 1 lev coin replaced the 1 lev banknote that had been released in 1999.