The pound has plummeted to below 1.15 from the euro and 1.3 up against the dollar, the smallest for years. So finding the foreign exchange is more essential than in the past. But this post is not about holiday money. It’s about people that should send small sums regularly, and others making large one-off transfers, such as getting a holiday property. It reveals that some providers are good for large sums, but pricey for smaller transfers – plus it tells you to protect yourself from PayPal, which came out particularly poorly in your price survey.

Consumers should first cut through any nonsense about “no fees” or “no commission”. Your key question ought to be: “After all the charges, just how many euros/yen/dollars etc can i get for X pounds?” To accomplish this, check how much you are offered from the mid-market “interbank rate”, the speed used when banks trade between one other. You can check the live interbank rate on

Secondly, you can be reasonably certian how the deal available from your high street bank will probably be pretty lousy, unless you happen to be “premier” type customer transferring large sums.

James Daley of Fairer Finance says: “Almost all major banks charge lots of money for transferring money overseas, and provide a poor exchange rate on top of that. The good thing is that several alternatives provide you with much better value.”

Our third golden rule is the fact, if transferring a sizeable sum in to a foreign account, first send a compact sum and check it really has been received, as much to ensure you have sent it to the correct account as whatever else. Only then should you send the entire amount.

Almost all major banks charge lots of money for transferring money overseas, and present a poor exchange rate on top of that

James Daley, Fairer Finance

Finally, remember there may be relatively limited protection should things go wrong. The currency brokers may be “authorised” with the Financial Conduct Authority (FCA) or just “registered”. Authorised firms ought to keep clients’ money separate from the company’s own funds. If your firm is just registered using the FCA there’s a risk all of the money is incorporated in the same pot and might be lost when the company went bust.

“Even in case a firm is FCA authorised, it’s essential to understand that there is absolutely no defense against the Financial Services Compensation Scheme within this sector,” says Daley. “So when a firm goes bust because of a fraud, there’s still an opportunity that you simply won’t get your money back. However, the potential risks if you’re utilizing a big brand are fairly small.”

In 2010, Crown Foreign Currency Exchange, located in Hayle, Cornwall, went bust, leaving 3,000 people owed £20m. It used new customers’ cash to pay off existing clients, and also fund purchasing a luxurious home. Three people in the scam happen to be jailed.

We obtained quotes for moving £200, £2,000 and £150,000 into euros and dollars. We conducted the test on 29 July if the pound was fetching €1.19 and $1.32 respectively, but sadly it provides since fallen further.

Ideal for small sums When transferring £200 we found UKForex best for euros and TransferWise best for dollars. UKForex is FCA authorised rather than registered, which is a subsidiary of the Australian group, OFX. TransferWise is really a peer-to-peer service (see below), headquartered in London and run by Estonians. Investors in the market include Richard Branson.

Worst in this particular bracket were MoneyGram and NatWest, which will go to show why you shouldn’t automatically use well-known names. For £200, NatWest gives us only $229.31, in comparison with $260.94 from TransferWise.

Great for mid-size sums When transferring £2,000, the Currency Account (for euros) and TransferWise (dollars) were best. The Currency Account is really a fairly new and small company, formed in 2014, and is authorised through the FCA. It describes itself being a “hybrid” peer-to-peer plus direct market access company.

Ideal for large sums We checked rates on moving £150,000, a sum where you will be seriously upset if anything went wrong. Again, the Currency Account came top for euros, though there was clearly almost no between it along with the other brokers. HiFX came top in the bracket for dollars. HiFX was established in 1998 and is amongst the largest brokers, having transferred around £100bn ever since then.

Currency brokers There are numerous currency brokers or money transfer specialists. These include MoneyCorp, Currencies Direct, CaxtonFX, TorFX, HiFX, UKForex, FairFX, Azimo and Xendpay. They virtually all advertise “bank beating” rates, so how do they compare against each other?

A handful of currency comparison sites can be purchased, nevertheless they won’t necessarily locate the best deal. If you’re looking for the most bang for your buck you will be happier likely to individual companies, getting a quote and asking just how long the transfer can take. When you notice a business offering a great deal, check out its reputation through the use of FXCompared, TrustPilot or a general Google search.

Established firms are generally, yet not always, the most reliable. Some smaller brokers and “disruptive” web platforms temporarily stopped trading throughout the EU referendum aftermath.

Peer-to-peer services TransferWise is among a whole new breed of peer-to-peer operators which remove the banks and brokers by providing an online meeting location for people wanting to buy each other’s currencies. You don’t send your cash directly, rather to the forex firm which in turn passes it on.

“Our exchanges derive from free or extremely low-cost local banking accounts transfers. We don’t send money overseas, so can eliminate the crazy fees that banks charge consumers,” says Taavet Hinrikus, co-founder of TransferWise.

Another peer-to-peer platform, CurrencyFair, works in the similar way, even though the exchange rates are positioned by its users. When there are no customers providing a good rate for your personal exchange, CurrencyFair will step in and complement you. The internet site claims customers typically pay .35% from the amount exchanged along with a fixed €3 transfer fee.

Additional options

If you have to pay in cash or transfer money quickly, Western Union and MoneyGram have branches in the high street – however services will not be cheap and only suited to a small amount. And even though the businesses are legitimate, they are often utilized by scammers, so be skeptical of strangers looking for payment in this way.

PayPal may make it easier to send money overseas, but was the highest priced option in two the Guardian calculations. It whacks on the hefty conversion fee in order to pay someone in another currency.

This article was amended on 22 August to fix the year when the Currency Account was create. It ought to have said 2014, not 2011.

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