We came across an article in The Australian Financial Review today on an interesting experiment of splitting a $200K AUD->USD transfer into two, with half sent via OzForex and the other half by one of the ‘big four’ Australian banks on the same day to compare what arrives at the other end.
The results are illuminating….!
If you have ever converted currencies or transferred money overseas, you may have been shocked to discover how much you were charged by your friendly bank to move your money.
Recently, a friend was preparing to transfer $200K overseas. I asked him if he would split the transaction into two lots, in order to try OFX.
After signing up to their online platform, he transferred $100K through one of Australia’s big four banks and the other $100K through OFX.
The resulting conversions after fees were $US90,500 via the bank and $US93,500 through OFX. That’s a 3 per cent difference for the same simple service.
He came away from this experience “thoroughly recommending OFX for a great rate, ease of use and secure platform”. He wondered why he had not looked beyond the banks for currency conversions previously.
Over time, experiences like this and the resulting word of mouth may put pressure on large financial institutions to revise the exorbitant fees they charge. OFX spotted this opportunity in the late 1990’s, and therefore has first-mover advantage. Since then, it has grown to employ more than 170 staff in Sydney, London, Toronto, San Francisco, Hong Kong and Auckland, and conducts 460,000 transfers with a combined value of $9.1 billion a year.”
We here at BestExchangeRates are glad other people are finally starting to notice what we have been saying for years…that people should definetly consider using the non-bank currency providers such as OFX when sending money abroad.
Register with OFX as an affiliate customer of BestExchangeRates to get all your transfers fee free.
Disclaimer: Please note any provider recommendations, currency forecasts or any opinions of our authors should not be taken as a reference to buy or sell any financial product.