I recently needed to transfer $1,000AUD to an account in Australia. I had a look at my Bank of Ireland account to work out how much it would cost. There was a fee of €5 for the transfer and ‘foreign exchange margin’ to do the transfer. I couldn’t find any particular percentage for the foreign exchange margin on the fees page. Bank of Ireland do publish their daily currency exchange rates on their website. Using this I could see on the day the transfer would have cost me €736.79 which included the €5 fee. XE.com said that the mid market rate for $1,000AUD was €704.75 so there was a markup of €27.04 hidden fee in addition to the €5 fee with Bank of Ireland. I decided to look around for other options and came across CurrencyFair and TransferWise. I have to admit, I don’t know why I dismissed CurrencyFair but instead used TransferWise.
Looking at the TransferWise homepage, it appeared that the cost to send $1,000AUD to Australia would be €709.69 a saving of €27.10 or nearly 4%. This includes a TransferWise fee of €4.94. TransferWise charge a fee depending on the currencies being transferred. The fee for EUR to AUD is .7% of the transfer value. I had never used TransferWise before so I had to start from the very beginning.
Setting up the account is easy and as expected really. Name, Address, DOB, email, password – the usual stuff required to set up an account. As my transfer was for under €1,000 I did not need to verify my identity. To send more than €1,000 in one transfer or €15,000 total in a year you must verify your identity. This involves uploading a copy of your passport or drivers licence to their website. Once my account was fully set up, I started to complete my transfer. It is a 5 step process.
1. Select how much to transfer
You can enter in either how much you would like to send or how much you wish the recipient to receive and it will calculate the other amount. I took the screenshot after I completed the initial payment so that explains why the amount varies slightly. You will see the exchange rate, fee and estimated arrival date. As I write this on Monday it is already Tuesday in Australia so the payment will clear the next working day, in this case Wednesday.
2. Sent by details
This is details of the sender, in this case me. Since I have already filled in my account this step is automatically filled in and I am taken to step 3.
3. Recipient details
Here you can choose from existing recipients that you have sent money to before or enter a new recipient. All I needed was the name, email, bank account number and sort code/BSB code.
4. Review Transfer
This step confirms the amount the recipient will receive, how much you will be charged, the fee and the date the payment should clear. You can also add in an optional reference so the recipient knows where the payment came from.
Last step is to actually pay for the transfer. There are 5 options, Credit/Debit Card, Bank Transfer, SOFORT Banking, iDeal and Instant Bank Transfer. Only two are relevant for Irish customers. You can choose to pay by Credit/Debit card or Bank Transfer. Paying by Bank Transfer delays the recipient receiving the money by at least 1 working day. You will be given an IBAN and BIC code for an account in Estonia as well as a reference number to make the payment. I decided to pay by my Debit Card. There was no extra cost and it was simple and quick although I did have to go through Verified By Visa. There is a .4% fee to pay by Credit Card.
Overall setting up my account took less than 5 minutes and the transfer probably only took a couple of minutes. From start to finish the whole process took less than 10 minutes and was very straight forward. I liked the way TransferWise made it very clear how much the transfer would cost up front and when it would arrive. Everything was clear and I hadn’t any questions or anything I was uncertain about. Sure enough, on the date they gave me I got a message from the recipient confirming they received the money. I’ll definitely be using TransferWise again in the future for my transfers but will also take a look at CurrencyFair. – I hope to have a post about Currency Fair shortly.