Transfer Charges

[Rimms]

Just a 'Beware' for those who use Barclay's to transfer funds from UK to Turkey. Due to having work done on the house, I have made several transfers over recent months, on each occasion it has cost me £25 which I was told are the admin fees associated with the transfer. A couple of days ago I made a transfer to ING bank and on checking my account I have been charged £75.

When I complained this morning to their International Dept. the explanation I was given is that there are actually 3 sets of charges associated with a transfer. 1 is your bank, 2 is an intermediary bank and 3 is the recipient bank. On my previous transfers I had been paying only the charges associated with Barclay's of £25 but on this occasion the counter clerk had ticked 'all payments' which came to £75.

After 30 minutes on the telephone and 3 different departments I have been awarded a £50 credit, so please beware!

[Scunner]

This has caused problems for years - also buyers sending stage payments and being £50 short when it arrives etc. One simple question I would love an answer to. Why is it Barclays, a massive banking organisation with offices in nearly every country in the World, and ING, another multi-billion pound banking group, have to use an "intermediary bank" to send money to each other? Surely they have the knowledge and experience to do it themselves?

It's just another banking con.

[GordonA]

You have just asked & answered your own very pertinent question Guv'nor.
There is no other reason for it [!]

[Highlander]

The Clydesdale Bank advised me that they would have to charge me £ 24.00 to transfer a miniscule amount to a very kind member in Perth.

[steveb1]

i think the word "bankers" comes to mind

[Ovacikpeedoff]

It is not just money transfers by Chaps or TTs where charges applied. It is a right money spinner for the banks. When I worked in banking we would only charge our own fee which was the same as the other banks.The fee that we charged was higher than the actual cost of the transaction and we absorbed the charges of the other banks. So in the end we were breaking even.The only problem with that was that the other banks charges kept rising and rising so transferring money turned into a loss maker and we eventually started to pass additional charges on. Banks do incur charges but if they all played fair and just passed the actual cost of the transaction they would be lower than what is currently charged.

Scunner transferring money internationally is not as simple as it sounds. many banks do not have international clearing systems and the money has to get transferred through an intermediary. It would not be cost effective for some financial institutions to have an international clearing syetm.

Some of the worst banks for money transfer charges were the Turkish banks.

[Jim Fraser]

Worth asking your Turkish bank to waiver their charges, have always managed to do this with Finansbank.

[Scunner]

quote:Originally posted by Ovacikpeedoff

Scunner transferring money internationally is not as simple as it sounds. many banks do not have international clearing systems and the money has to get transferred through an intermediary.

I bow to your banking experience (and my lack of) but my point was about the original post - surely banks like Barclays and ING are ones that do have 'international clearing systems' - whatever one of those might be ?

[Ovacikpeedoff]

Transferring money is really a two stage affair. The first part is the part we all know about is something like SWIFT.This is really the secure messaging system that actually gets the money from the senders account to the recipient account. SWIFT is a company that is set up and owned by the big banks.The second part of the transaction is the settlement side. When cash goes from one account to another then it leaves one bank and goes to another. It is not just one individual transaction that takes place but millions and the transfers go in different directions. So what you finish up with is a net settlement figure and that is paid over.In todays banking world you have probably received the money in your account before the final settlements have been made. So banks have got to run risks such as credit and settlement risks.

Without systems like SWIFT the money transfer systems could be left open to fraud or money laundering. The other alternative would be to send cheques and that would take weeks to get into a bank account in Turkey.Through SWIFT once the money hits your account and it is a genuine transaction the sending bank cannot claim it back if your bank does not settle the outstanding settlements.

All transactions will go through the same process whether it is between 2 banks in the same group.

Scunner, you like many of us would never dream of fraud or money laundering but there are many that would. When I was in the bank every application we got from one African country was checked and double checked because they were notorious for fraud.

What I have said above is a simple summary of the process. There have been many chapters in many books written on the subject.

[corbindallas]

Another option if you are visiting is to get an International Cheque drafted, made out to yourself, banks charge around £20 for this type of cheque and you can then deposit it at your bank in Turkey, they will take upto 20 days to cash it into your account but they will not charge you to do this and that's it £20 flat.I do this cheque route now via Lloyds and ING as I also got stung on additional handling charges when using the old method and they also charge more if you transfer higher sums, think the last time I did it they charged me £35 in UK another £43 in Turkey by the middle bank and the recieving bank waived their fee luckily, still £78 to transfer money is ridiculous!