Bank customers getting a raw deal when transferring money overseas

New research from Andrew Hagger of Moneycomms reveals that high street bank customers are paying a heavy price when it comes to sending foreign payments overseas.

Simply by using the services of a specialist online FX provider, consumers could save more than £53 on an £1100 transaction.

While some banks may appear to offer a reasonable deal on mainstream currencies such as the Euro and US Dollar, when it comes to lesser used currencies such as the Czech Koruna, Polish Zloty and Swiss Franc the costs are far less competitive.

The added transaction fees across all currencies make the banks even more uncompetitive.

Hagger said: “Consumers simply don’t appreciate that there are cheaper alternatives available and are confused by the combination of uncompetitive exchange rates and transaction fees levied by the banks.”

“Even though some providers claim to offer a fee free service the wide variation in bid-offer spreads charged in FX transactions often represent the major hidden cost to retail customers.”

Ian Strafford-Taylor (CEO) of FairFX said: “the bewildering array of tariffs for transferring money overseas makes life difficult for the man on the street, the situation is further complicated as many of the banks charge fixed fees as well as a bigger margin on the rate of exchange”.

The research below was commissioned by FairFX and carried out by MoneyComms on Tuesday 18th February and reveals just how much extra a consumer could pay if using their own bank to send the money overseas.

In isolation these sums may not sound that much, however when you consider many people with property overseas or children studying and travelling abroad are transferring funds every month to cover costs, the annual savings could be in excess of £600 in some cases.

It has been reported previously that up to 90% of transactions are still conducted through the banks, so there is a huge amount of money to be saved if only consumers took advantage of deals from some of the specialist breed of online brokers such as FairFX ,Caxton FX , HiFX and Moneycorp.