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You should be angry. No. You should be furious.

Every time you’ve transferred money abroad, or exchanged currencies before a vacation, you’ve been ripped off. Horribly so, in fact. When you factor in unfair fees and wildly disparate exchange rates, the total loss to you can often exceed hundreds of dollars.

That’s your money.

The two biggest culprits are banks and currency exchanges, who rake in billions of dollars each year, largely at your expense. But they needn’t. Here’s how you can get your travel money and transfer money between 5 Tips You Should Always Remember For Sending Money Internationally 5 Tips You Should Always Remember For Sending Money Internationally Sending money internationally is a potential minefield of hidden charges, security concerns, and paperwork. There are some tips you should always remember to keep your experience as cheap, smooth, and hassle-free as possible. Read More international bank accounts without getting stung.

Foreign Exchange

Quite often banks, currency exchange shops, and post offices advertise themselves as offering 0% commission on currency exchanges. They’re lying.

The problem is, they’re technically not. Whilst they don’t charge you a flat fee, they do charge an inaccurate rate of exchange. This can often be as much as 13% in their favor. This means that if you exchange $1,000 US Dollars for another currency, you’ll be as much $130 out of pocket.

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Thankfully, not for much longer. Coming out of London – the unofficial world capital of financial technology start-ups – WeSwap aims to make it cheaper, easier and faster to exchange currency.

finance-weswap

The principle behind the application is simple.

You register on the WeSwap website, and once they’ve verified you are who you say you are, they’ll send you a free MasterCard debit card MasterCard and Visa Begin Digital Wallet Services [Updates] MasterCard and Visa Begin Digital Wallet Services [Updates] Read More . It’s important to stress how above-board WeSwap are. Not only do they make as many efforts as possible to keep fraudsters off the site, but they also adhere to strict regulations established by their payment gateways and the other financial institutions they deal with.

They’re also regulated by the Gibraltar Financial Services Commission, which represents all financial services companies operating in the UK-owned territory.

Once registered, you can then pre-load your debit card with multiple foreign currencies – up to 16 as of April 2015, including US Dollars, British Pounds, Japanese Yen and Australian Dollars.

However, you’re not necessarily buying your currency from WeSwap. Rather, you’re exchanging currency with other members of the site, who are all looking to get cheap foreign currency for their next big trip abroad. This is all done seamlessly and quickly, and you are only charged 1% of your transaction. If you’re looking for a more niche currency – like Polish Zloty, or Hungarian Forint – and there isn’t enough user-generated supply, you can always buy it from WeSwap themselves. Although here, they’ll charge you a 1.5% fee, which is still pretty competitive given what you’ll get charged on the high street.

It’s important to stress that you’re getting the best rates possible. Not the ones on the high street, but rather the rates a bank would get, which are provided through the XE currency rates XE Currency Is The Best Way To Get Monetary Conversions On The Go [iOS] XE Currency Is The Best Way To Get Monetary Conversions On The Go [iOS] If you are looking for a fantastic application to do monetary conversions on your iOS device, look no further than XE Currency. It has a slick, easy to use interface that makes it easy to... Read More platform.

Once you’ve swapped your currency, you’re good to go. It’s all loaded on your MasterCard, and you can spend it as you would with a normal debit card.

If you have multiple currencies on the one card there is no need to worry about the wrong balance being deducted, the service will automatically choose the correct currency depending on which country you are in.

The only downside is that WeSwap is currently only available in ten European countries, including the UK, Sweden, Norway and Italy. They do, however, have plans to enter the US market in months to come.

Bank-To-Bank Transfers

I’m originally from the UK, but for a long while I lived in Geneva, Switzerland where I was employed as an IT worker for an NGO. Each month, I’d transfer money to my mother, so she could pay off my British credit card. It was an arrangement that worked, but was eye wateringly expensive, as anyone who has ever used Western Union knows.

finance-westernunion

There has to be a better way.

Unfortunately, the banks aren’t much better. Most banks in the UK charge around £25 ($40) to make an international bank transfer. It’s just as steep in Europe, and in the United States.

One company looking to eat Western Union’s dinner is TransferWise, who operate in North America, Europe and India, and promise to transfer your money across borders for only 0.5%. TransferWise is regulated by the UK’s Financial Conduct Authority, and like WeSwap, is based in London.

From a consumer’s perspective, TransferWise works not unlike traditional online banking websites The 7 Best Online Banking Features For Simplifying Your Life The 7 Best Online Banking Features For Simplifying Your Life Does money management stress you out? What if you could effortlessly alleviate some of that stress for good? Online banking offers a lot of benefits that can help to simplify the headaches of money. Read More . Log in to your own account, type in the amount and recipient, and press send. But what’s interesting is not the mechanism to send a payment, but what actually happens behind the scenes.

Instead of directly sending the transfer and incurring fees, they instead wait and see if their request for payment can be fulfilled by locally available sources of funds.

This has a few advantages. Firstly, it’s significantly more expedient than certain methods of transferring money, although nothing quite beats Western Union which can transfer funds across borders in just a matter of hours.

Secondly, it means that the transaction is cheaper to make, since no money is crossing borders, and they can use an exchange rate that approaches the actual market value.

Since it’s a modern, regulated system, they’ve taken steps to protect TransferWise against any fraudulent usage. This is massive, as currency transfer agents have traditionally be used by West African 419 scammers to receive funds, as our own Angela Alcorn found out last year How I Nearly Got Conned Via A Western Union Transfer Scam How I Nearly Got Conned Via A Western Union Transfer Scam Here's a little story about the latest "Nigerian scam", which is all too obvious in hindsight and yet so believable when you're on the hook. Read More .

That’s an incredibly compelling offering, especially when compared to banks who charge more, and are slower at executing transfers.

Never Get Ripped Off Again

Bad news, banks. The era of you ripping us off has passed.

Simply put, there are better, cheaper alternatives to you, and you’ll never get our custom ever again. For those of us looking just to save a few bucks, this is awesome. But for the millions of expatriates and migrants who use banks and transfer agents to send remittances back home, this is vital.

What do you think? Do you have a clever way of transferring money back home? How do you get your travel money?

Let me know in the comments section below, and we’ll chat.

Photo Credits: banknotes Via Shutterstock, WeSwap (Karen Brown), 360b / Shutterstock.com

  1. Marina
    August 2, 2016 at 8:02 am

    I am currently working in Taiwan and I had to send some money to my father-in-law who is in Australia. With my first bank transfer from Taiwan to Australia, he was suppose to receive AUD 450, but there was almost AUD 50 deducted for fees by both banks.

    For my second transfer, I decided to open another bank account in Taiwan and when I received my VISA debit card, I posted this card to him. All he does now is to withdraw the money from any bank in Australia and the fees on my bank account statement is approximately AUD8.

  2. Bre
    November 17, 2015 at 5:19 am

    Totally agree - hate banks. There's a good breakdown of some of the other transfer services to choose from for the best exchange rate on http://transumo.com which has helped me save a lot of money moving from the US to Australia.

  3. Dani
    April 15, 2015 at 7:49 pm

    I am using Paysera for international transfers. They have great exchange rates for some currencies, including AUD. Also there is no limit for transferred amount, which makes it quite convenient for transferring larger amounts. In order to transfer money I had to open an account with them and every before sending money abroad I am topping up this account. There is a small fee for crediting the account and a transaction fee, however it is times smaller than bank fees.

    • Matthew Hughes
      April 30, 2015 at 3:34 pm

      That's something I've noticed. There are few money transfer services that are 'free'. Most have some kind of fee attached. But those fees are a fraction of the usurious amount the banks charge.

  4. doovers
    April 15, 2015 at 1:06 am

    I've been using currencyfair for over a year now to exchange EUR for AUD. it works on the same principle as weswap and I find it an excellent service. I would've interested to see a comparison between the two.

    • Matthew Hughes
      April 30, 2015 at 3:33 pm

      Maybe in a future article. :)

  5. Ama
    April 15, 2015 at 1:03 am

    I have an online store where we sell Nepali artwork. Someone made a purchase from one of the Northern European countries and they lost about $50 or more on a transaction of less than $500. This service would make such transactions much better. The US merchant service companies don't give a good exchange rate, so I think this is a great alternative.

    • Matthew Hughes
      April 30, 2015 at 3:32 pm

      That's really interesting! I'm not sure TransferWise is available in Nepal, but if it is it could probably save you a fair bit of cash!

  6. Anthea Lowe
    April 14, 2015 at 8:19 pm

    Matthew - GE Credit Card account is held in Australia. No fees charged when I buy anything in foreign currency.

    • Matthew Hughes
      April 14, 2015 at 9:05 pm

      Interesting. We don't really have anything like that in the UK.

  7. Shawn Rosvold
    April 14, 2015 at 6:54 pm

    Wish I could edit that last comment. I don't think WeSwap is available to US customers.

    • Matthew Hughes
      April 14, 2015 at 6:59 pm

      Ha, it happens man. But yeah, it's definitely coming to the US... Eventually.

  8. Shawn Rosvold
    April 14, 2015 at 6:53 pm

    I don't this htis is available to American customers. Too bad.

    • Matthew Hughes
      April 14, 2015 at 6:54 pm

      WeSwap isn't (yet). However, I think TransferWise is.

  9. Katie
    April 14, 2015 at 2:04 pm

    Anyone ever tried Kwanji? Heard a couple of good things..

    • Matthew Hughes
      April 30, 2015 at 3:34 pm

      Never! Looks interesting though!

  10. Tim
    April 14, 2015 at 11:55 am

    Take a look at xoom.com . . . a satisfies user.

    • Matthew Hughes
      April 14, 2015 at 6:54 pm

      Interesting. What do you like about them?

  11. Anthea Lowe
    April 14, 2015 at 5:29 am

    I use a GE MasterCard for all foreign credit transactions. No commission. XE platform currency rates.

    • Matthew Hughes
      April 14, 2015 at 6:55 pm

      Wow! May I ask what country you're in? And does your credit card charge you any fees when you use it abroad?

  12. peter
    April 14, 2015 at 4:31 am

    Localbitcoins.com - global remittance.

    • Matthew Hughes
      April 14, 2015 at 6:55 pm

      The problem with Bitcoin is that it's far, far too volatile. I'd never dream of using them for anything as important as sending remittances back home.

  13. Justin Player
    April 14, 2015 at 3:01 am

    I tried WeSwap and got a worse rate than with the bank. Its not as good as you think.

    • Matthew Hughes
      April 14, 2015 at 6:56 pm

      Really? What currencies? And what bank, do you mind me asking?

  14. Michael
    April 13, 2015 at 10:03 pm

    Circle & bitcoin... transfer money internationally using this all the time

    • Matthew Hughes
      April 14, 2015 at 6:57 pm

      Interesting. I'd never dream of using Bitcoin as an actual currency. And definitely not to transfer remittances. It's just too damn volatile.

      Do you find that to be a problem for you?

    • Michael
      April 15, 2015 at 12:25 pm

      Not really when using Circle, because I "buy" it with one bank account then "sell" it immediately with another. Whole process takes about 45 seconds

  15. jasray
    April 13, 2015 at 8:43 pm

    US dollars are better exchanged on the street. The typical "black market" necessarily provides an exchange rate much higher than any other outlet. One reason may be the transactions aren't conducted in "brick and mortar" buildings--no overhead. Another is the reality that money is being "laundered" which really means everyone involved wins. And, using the street for transactions, is, in many countries, the only realistic way to exchange money--cards, banks, WU--no existo. You know, now that I think about it, I am paid a premium to exchange on the street. Kinda weird, but it works, and everyone is happy in the end. That "green" money--foreigners love it!

    • Matthew Hughes
      April 30, 2015 at 3:35 pm

      That depends where you go, to be honest. I think you'd have a very hard time to exchange US dollars on the street in Europe or Australasia, for instance.

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