Your site for international money transfer comparison news and views for individuals and businesses
If you are a frequent flier, and a fan of using plastic over hard cash, then doubtless you will be aware that you can collect points for spending with your credit card that can be used to subsidise your air miles.
Air miles and credit cards seem to enjoy a fruitful relationship, and have done so for a matter of decades; and yet so few of us take advantage of the options available to us. Read more “3 Best Credit Cards For Picking Up Free Air Miles”
Take a deep breath. For once, Brexit woes have taken a back seat and the currency markets have had a little breathing space. With no fresh crises or emergencies, it has been relatively plain sailing this week for Sterling. Perhaps a good time then, to think about making that pounds to euros transfer you had been putting off? Read more “3 Great Deals For Sending Money Overseas: Pounds to Euros”
Spain is generally regarded as being an expat friendly country, and indeed it is, but if you are not a permanent resident in Spain (and here is a guide explaining how you can become one) then obtaining a mortgage to purchase a property in the country can be tricky.
Tricky, but far from impossible. Whilst some lenders are not open to borrowers from overseas, others are more than happy to help foreigners finance property purchases. But, if you are an overseas buyer, or even a Spanish person living abroad, then you can expect to pay higher interest rates on your mortgage. Read more “3 Of The Best Mortgage Providers For Non Residents Buying Property In Spain”
Before you pull out and flourish your credit card to pay for your goods and services whilst travelling overseas, think twice – then think again!
Withdrawing money using a credit card is a costly move even in your own country – credit card companies penalise cash withdrawers heavily with a host of associated charges – and the same applies overseas – don’t think the same rules do not apply. Read more “3 Overseas Credit Cards To Use Abroad”
Overseas investment; property, financial, or business related; supporting family and relatives overseas; moving and living abroad; importing or exporting goods over the medium to long term.
These are all good, and prominent reasons for taking extra care that you are managing currency exchange rate risk effectively. Failure to do so; using a high street money transfer company last minute to make a significant transfer of funds from pounds into euros, dollars, or renminbi, for example; can result in paying way over the odds, in fees and charges, or exchange rates skewed in the vendors favour. It could cost you 5% extra each and every time you make such a transfer, research shows. Read more “3 Of The Best Expat Overseas Bank Accounts”
There is a hopeless romantic inside every one of us, and if ever there is a perfect time to give it free rein, it’s your wedding day. How much will a dream overseas wedding set you back? At The Money Cloud we have carried out some research on your behalf, to make sure you have the “perfect figure” in mind for your big day. Read more “Overseas Weddings: Thinking Of Getting Hitched Abroad? Here’s How Much You May Have To Pay”
The dream of becoming the next Amazon-affiliated drop-shipping millionaire is one that most of us have had at some point in our careers, usually after a bad day at the office or a long holiday. But can it be done? Read more “Starting An International Online Business? Try Canada or UK, New Study Says”
The “Maybot” was given a fresh new outing today as British Tory Prime Minister Theresa May danced her way onstage to deliver the annual speech at the Conservative Party conference. But did the international trade and finance community or those of us with personal finance interests abroad learn anything new about the party’s plans for Brexit and foreign policies? Read more “Dancing Queen or Brexit Screen? May’s Annual Conference Speech Dissected For International Traders”
Some people like plastic, whilst others prefer cash. These two payment methods have been around for generations, and, until recently, there has been little to choose between them when it comes to choosing how to pay for goods and services.
Today, however, and particularly in the Western world, it seems that we are increasingly moving towards a “cashless” society, where debit and credit cards, or even mobile wallets, hold sway. But what about when we spend time overseas? Read more “Multi Currency Debit Cards – Should You Have One?”
Over the weekend, news emerged that overseas footballers in the UK; of which there is a higher proportion than in any other international football league; have been attempting to hedge against further falls in the value of Sterling.
Sterling has fallen around 15% against both the euro and the dollar since Britain voted to leave the EU, dropping 3% in the past 3 months, and creating problems for businesses and individuals alike. In the case of the Premierships’ multi-millionaire footballers, many are asking to be paid in Euros, a request which football clubs, even those as rich as Manchester United, are struggling to accede to, due to the fact they do not hold sufficient foreign currency reserves.
Currency hedging can be a tricky business; knowing when to buy or sell a currency is an instinct that the best FX currency traders, for example, possess, but not even they can get it right every time. So what are the best options for individuals and businesses with financial commitments overseas? Let’s look at 3 strategies that might help to protect against unexpected, unplanned for losses.
If you are a seasoned entrepreneur, business owner, or traveller, you may feel that you have an understanding of how currency movements play out, and what can be done to hedge against them. But experience alone is not enough; to ultimately make the right choices, planning ahead is essential.
All businesses, and even most domestic households, create budgets to try to plan for the future. In order to plan a currency hedging strategy effectively, it can be useful to plot different scenarios; a best case, worst case, and most likely case, for example, is a good start.
By plugging in different currency fluctuation scenarios into your budget, it should be possible to calculate when, for example, a sale and delivery of goods overseas becomes unprofitable, a holiday or spell abroad becomes prohibitively expensive, or, alternatively, when it becomes attractive to spend in the short term for longer term financial gain.
There is no guarantee that your scenarios will play out in real life, but they can certainly provide an effective way to manage your currency risk. It is up to a business, or individual, to decide how much appetite they have for risk – but before doing that, it is essential to have a clear picture of what kinds of problems and issues different attitudes towards currency risk will throw up. Fail to prepare,prepare to fail, as they say.
Consult a professional broker
If you are do not feel confident about which strategy is best for you, your family or your business, then it may be worth reaching out for professional help.
International currency brokers naturally charge a fee for their work, so it’s important to decide if the level of risk you are exposed to justifies the extra cost. Sometimes, currency related losses are simply unavoidable due to market, or political forces; witness the current situation in Venezuela, for example, where the government has been forced to launch its own Petrodollar cryptocurrency, a hedge against the Venezuelan Bolivar, which has simply spiralled out of control owing to uncontrollable levels of inflation.
If your currency risk exposure is long term and consistent, however, i.e. you are making regular overseas payments or regularly selling goods overseas, then a broker can help. They are likely to have a superior knowledge of how the markets may move, and not only that, they have access to vast, cheap, quantities of foreign exchange, giving them a significant advantage in the marketplace.
Interacting with a broker on a regular basis will improve your own knowledge of the FX markets, so you may not need to consult directly with your broker over every transaction, but if you have a significant foreign currency exposure, working with an FX broker represents a no-brainer.
Open a self-managed account
Thanks to the rise of disruptive technology, there is a great deal more transparency around the FX markets than there once was. Most brokerages, and a growing number of fintech startups, provide the means for you to run your own currency hedging service. There is no shortage of newsflow, either.
Comparison sites like The Money Cloud can give you an instant overview of the rates, fees, and transaction times offered by a range of MTOs (Money Transfer Operators), and even provide a digital dashboard that helps you quickly negotiate AML (anti-money-laundering) and KYC (know your customer) checks, store all of your transaction history for future reference, and even use techniques such as AI and machine learning to help guide your decision making process.
Brexit has created huge disruption in the value of Sterling, and the instability shows no signs of abating. Within the EU, nothing is guaranteed, as trade wars with the US and differing political agendas create uncertainty, whilst the US, China, Russia, Africa, the subcontinent, Asia and Australasia all have a role to play in sudden and unexpected foreign exchange fluctuations.
As discussed above, there are many different strategies that you can use to protect your own interests, whatever they may be; the one thing you can’t do, in the current environment, is do nothing. Other than that, it is up to you; whether you are an entrepreneur, traveller, or pro-footballer; to decide how best to hedge your currency exposure.
The FCA plans to take action against firms offering misleading exchange rates to potential customers, such as offering the “interbank” rate, only to switch to an alternative, less competitive rate once the customer is at a more advanced stage of the transaction.
Besides the offering of “unachievable” exchange rates, the FCA wants to stop firms making unsubstantiated claims about how much rival services charge, “unless the comparison is fair and balanced and the firm can prove that the claims made are true.”
The FCA revealed that the UK currency exchange transfer market for outbound services is worth approximately £60bn per annum, with remittances; sending money overseas regularly to support family or friends; responsible for roughly £18bn of that figure.
The new rules will be aimed at protecting “consumers who are individuals acting outside their trade, business or profession, micro-businesses and charities with an annual income of less than £1 million”, who are perceived to be most vulnerable due to having less experience of foreign currency exchange markets and what the precise costs of making a transaction ought to be. The FCA will insist that: “where providers compare the costs of their service with other providers, they do so in ways which are meaningful, fair and balanced, and capable of being substantiated.”
The main concern is the way in which a foreign exchange company may communicate a promotion offering a particular rate to win a customer’s business, only to offer a less competitive rate once the customer has all but committed to using the firms services. In the FCA’s view, the misleading offer has prevented the customer from visiting other sites or using a comparison service to compare real time or achievable rates offered by other service providers.
As much as possible the FCA wants to make sure that customers are getting all the facts and that there are no hidden charges or fees that are applied at a later stage, making a seemingly inexpensive transaction more costly than advertised, and giving the service provider an unfair advantage over competitors who are more transparent about their pricing and provide information about additional charges up front.
The FCA says that “research and evidence collected on market practices, as well as customer behavioural trends, indicate that customers face challenges in understanding the total cost of a currency exchange transaction”, and that misleading advertising “could lead to losses for consumers and SMEs.”
The second Payment Services Directive (PSD2) which came into effect EU-wide in January this year has introduced new legislation designed to curb misleading advertising practices within the international money transfer industry, and covering “disclosure of information, cost and charges for currency conversions”. The FCA also plans to take into account directives from the European Commission “designed to increase transparency of charges for payments that involve currency exchanges and to increase the comparability of the options available for payment service users.”
The FCA is inviting feedback from firms and interested parties before it decides what specific action to take. The public consultation closes in November, with new rules and guidelines expected to be released published early in 2019.
If you are looking to send money abroad and would like to use a comparison service that gives you all the facts, including fees, exchange rates and transaction times, try The Money Cloud. We work exclusively with regulated money transfer brokers and use API’s to display real-time rates that you can compare for a wide range of currencies in just a few clicks.
The world’s best footballers tend to earn jaw dropping sums of money, and their tax affairs tend to be complex, to say the least. In the past couple of years, in Spain, several, including Lionel Messi and Cristiano Ronaldo, who play for Barcelona and Real Madrid respectively and together share the mantle of “world’s best footballers” have tangled with the Spanish tax authorities over undeclared income. Read more “The Non-Dom Tax Rule: Understanding Remittance vs Arising Taxes (& How It Could Save World’s Best Footballers Millions)”
This month, Google announced some sweeping changes to its payment services, which had become a little confused, and confusing. Read more “Google Is Cleaning Up It’s Payments Act, Merging Apps & Offering Enhanced Services; Could International Money Transfer Be Next?”
The technology industry is sometimes guilty of over-hyping its influence over the world, and over-exaggerating the usefulness of its products. Is a restaurant food ordering app really so very different from a takeaway menu leaflet? Was a taxi-cab rank genuinely the inconvenience that it is made out to be today? And remember when dating meant face-to-face contact over dinner or a drink, rather than swiping left or right in a couple of milliseconds?
In the case of money transfer, you could be forgiven for concluding that, despite the hype about mobile wallets, blockchain remittance services, superior exchange rates offered and fees reduced to all-time lows, you’d rather stick with the tried and tested. Read more “What Type Of International Money Transfer Services Are You Using (& What Type Should You Be Using)?”
It’s coming home. England’s nerve-shredding victory over Colombia last night was watched by an incredible 23m of the population, and whilst many may have been hiding behind the sofa as the goals, fouls, and penalties flew in, a nation is celebrating, and contemplating an unprecedented run all the way to the final of Russia 2018. Can you get to Russia in time for the QF? Maybe, just maybe. Read more “How To Make It To Russia To Watch England Play Sweden In World Cup QF – & Save Money!”
Amidst all the recent discussion and hand-wringing around the new GDPR regulations, it’s easy to forget that it was only in January this year that the updated Payment Services Directives, a set of EC-wide regulations designed to make it easier, faster and less expensive to for customers to pay for goods and services, by promoting innovation, came into force.
If the introduction of PSD2 has gone a little under the radar, a new report from PWC, in association with the Open Data Institute, argues that the effects of the Open Banking “revolution” certainly won’t. The report estimates that “Open Banking has the potential to create a revenue opportunity of at least £7.2bn by 2022 across retail and SME markets.” Read more “PWC / Open Data Institute Investigate State Of “Open Banking” Revolution In New Report”
2 London startups who both enjoy stellar reputations as customer focused, tech savvy disruptors of their big bank rivals are joining forces to launch an international money transfer service. Read more “2 Of London’s Trendiest FinTech Startups Join Forces For International Money Transfers”
I recently returned from an event of bucket-list ticking importance in my life. It may have “only” been Thursday Free Practice, it may have been the cheap seats (home straight, watching the cars come blasting out of Anthony Noges, the last corner) but my brief and surprisingly affordable experience of the 2018 Monaco Grand Prix is definitely one that will stay with me for a long time. Read more “Grand Prix Aside, The Most Sought After Prize In Monaco Is Citizenship By Investment”
Modern technology, and mobile tech especially, is making a multitude of lifestyle services easier to deal with; provided you are up to speed with the latest tap, swipe, scan and track technology, many things, including sending money overseas, can be done faster, easier, and cheaper using apps. Read more “The Best Money Transfer Apps of 2018 So Far…?”
London, May 15th
Medifinance, the Intelligent Financial Lender for Healthcare Professionals, and The Money Cloud, an award-winning provider of international money transfer price comparison, are delighted to have agreed a partnership to supply medical professionals with a real-time, sophisticated and reliable overseas money transfer solution. Read more “Medifinance Partners With The Money Cloud To Help Medical Professionals Discover The Best Deals On Overseas Money Transfers”