Consumers paying over the odds for currency transfers
High street bank customers are paying over the odds for sending foreign payments overseas, according to Moneycomms.co.uk.
Moneycomms.co.uk said that even though some providers claim to offer a fee free service, uncompetitive exchange rates represent a "major hidden cost to retail customers."
On top of this, some banks also charge additional fees for foreign currency transfers.
The difference between the cheapest option to send $1,000 overseas is £39.34, with FairFX the cheapest (it would send £631.71 after fees and exchange) and Western Union the most expensive (£671.05).
"In isolation these sums may not sound that much, however when you consider some people with property overseas or children studying and travelling abroad are transferring funds every month to cover costs, the annual savings could be well in excess of £400 in some cases," said Andrew Hagger of Moneycomms.co.uk.
"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 new breed of online brokers such as FairFX and Caxton FX."
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This is more usually a feature of car insurance but it can also crop up in contents, mobile phone and pet insurance policies. An excess is the amount of money you have to pay before the insurance company starts paying out. The excess makes up the first part of a claim, so if your excess is £100 and your claim is for £500, you would pay the first £100 and the insurer the remaining £400. Many online insures let you set your own excess, but the lower the excess, the more expensive the premium will be.
The difference between two currencies; specifically how much one currency is worth relative to each other. For example, if £1 is worth $1.50, converting sterling to US dollars, the exchange rate is 1.5. Converting dollars to sterling at those levels, the exchange rate is 0.66, so $1 is worth 66p. There are a wide variety of factors that influence the exchange rate, such as a country’s interest rates, inflation, and the state of politics and the economy in that country.