If you’re planning to transfer currency for an overseas investment, you’ll probably
talk to your high-street bank. Don’t! You’ll save money by going to a specialist
currency exchange dealer.
Send all your international transfers through currency dealers rather than banks. Why?
They give you a better exchange rate, lower costs and a speedier service. This is a constant source of annoyance to the banks but they can't compete with dealers.
An average high-street bank will probably offer spot rate (the real, interbank, rate of exchange), less 4 per cent. An average currency dealer will offer an ordinary customer spot rate, less 2 per cent. On a £100,000 transfer you save £2,000 on the exchange rate alone.
The dealers will be quicker too. In the days before currency dealers became popular, the money would be send by a UK bank to another country via another bank in the local country who would then eventually send it to the end bank. There were three banks involved but, more crucially, there would be a bank in the middle that didn't really care how long it took them to send the money!
Check the Charges
When it comes to comparing dealers, it is worth remembering that, in addition to
exchange rate differences, there are also differences in charges. Currency dealers typically charge less than high-street banks for transferring money abroad. In fact, many of them don't charge anything at all or, more accurately, they incorporate the fees into the exchange rate.
One example of this is - two transfers to Turkey done through a well-known high-street bank. The first for £100,000 and the second was for £200,000. The high street bank charged fees of £535 and £1035 respectively. This is a total of £1,570 just in bank charges.
A currency dealer would have charged either nothing or a nominal amount such as £20 (i.e. a saving of £1,550). And remember that this is in addition to the exchange rate differences (which probably amount to another couple of thousand pounds).
Link to our currency exchange partner page - LINK
There are many reasons why you may have been the victim of payment protection insurance (PPI) mis-selling. If you have been mis-sold PPI you could be entitled to claim compensation. To help you find out if you are a victim I have produced a quick checklist so you can see if you may have a claim.
First, you need to check if you had PPI on any credit cards or personal loans during the past six years, even if you have since paid them off. If you did have PPI then run through the checklist below your bank or lender had a responsibility to ensure the PPI was suitable for you at the time it was sold to you.
· Did your bank or lender tell you that you must have the PPI as part of the deal to get the credit card or loan? If so, that’s wrong. Having PPI is entirely optional.
· Was the PPI added to your credit card or personal loan without your knowledge? For most people it is not immediately apparent they are paying for PPI because its cost is merged into the loan repayments. The terms and cost of the insurance should have been explained and checked for suitability.
· Were you unemployed, self-employed, redundant, a student or retired? If so and you were sold employment cover as part of the PPI policy then it’s often worthless. You should have been made aware of this.
· Did you have any pre-existing medical conditions? Your bank or lender should have checked this as any pre-existing medical conditions are likely to be excluded from the PPI cover. You should have been made aware of this.
· Did you already have existing cover through benefits available from your employer? If so, your bank or lender should have checked this.
If one or more of these points apply to your circumstances at the time the PPI policy was sold to you, then it’s likely you are the victim of mis-selling.
Governor King’s Inflation Report press conference will provide a timely update on how the Bank of England is viewing current financial market developments. The Inflation Report itself will contain medium-term forecasts for the economy. Lloyds TSB have argued that the Bank’s growth forecasts appear too optimistic and its central case is likely to be revised down from just under 2% this year and 2½% next. This is particularly true with the apparent materialisation of downside risks from the Eurozone. Lloyds TSB would also expect to see an associated softening in next year’s inflation outlook (although for 2011 should remain broadly unchanged) despite a boost from lower market rates that the Bank uses to condition these projections. Yet these forecasts still look likely to suggest a set of economic conditions very different from those that led the Bank to ease monetary policy to its historic lows. Nevertheless, with global financial markets threatening to reverse developed economies recoveries, the MPC’s discussions will be dominated by assessments of how much damage the current financial turmoil will wreak on the real economy. This week’s trade release will gauge the ongoing pace of rebalancing in the economy. May saw the deficit widen with trade (including services) breaching the £4.0bn mark for the first time this year. Much of this reflected a jump in imports that Lloyds TSB expect to reverse in June. Accordingly Lloyds TSB forecast the deficit narrowing to £3.8bn. However, Q2 looks unlikely to provide further evidence of an export led recovery. Export volumes look likely to have fallen in Q2 and net trade should have detracted from growth. As with the wider economy, one-off factors affected Q2. But with global economic activity seemingly slowing, export prospects have weakened.
The final release of the quarter is always somewhat historical, with preliminary estimates inferred from the GDP release. Official estimates for manufacturing that recorded a 0.3% contraction in Q2, consistent with a 0.2% rise in June. However, Lloyds TSB suspect that oil production staged a bigger rebound in June than assumed, something that would lead to a 0.6% rise in the wider industrial measure and result in a 1.3% quarterly decline (1.4% estimated). This will have little impact on Q2 GDP, but would provide some support for the expected rebound in oil in Q3. Given market developments, focus has now shifted to the likely pace of Q3 expansion.
Written by Ashley Ingle - Excel Currencies
August 8, 2011 at 10:57 AM
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