| International Money Transfer — Key Facts | |
|---|---|
| True cost | Transfer fee PLUS exchange rate margin (typically 1-4% above mid-market rate) |
| High street bank | Typically 3-5% worse than mid-market; transfer fee on top |
| Mid-market rate | The real rate shown on xe.com or Google — providers add a margin |
| FCA regulation | All UK money transfer firms must be FCA-authorised or registered |
| Speed | Wise and Revolut: minutes to hours; SWIFT: 1-5 business days |
| Large transfers | Over £10,000 — specialist FX brokers offer better rates and forward contracts |
Sending money internationally costs more than most people realise because the exchange rate margin — not the headline fee — is the main cost. Even a 1% margin on a £10,000 transfer is £100. Specialist services consistently offer better rates than UK high street banks for the same transaction.
Understanding the True Cost
Compare providers by how many units of destination currency the recipient actually receives. Use xe.com to find the mid-market rate, then calculate the effective margin each provider applies. A 2% margin means the recipient receives 2% less than the mid-market equivalent — the cost is built into the rate, not shown separately.
| Provider type | Typical total cost vs mid-market | Speed | Best for |
|---|---|---|---|
| High street bank (SWIFT) | 3-5% total | 1-5 business days | Legacy use only; not competitive |
| Wise | 0.4-1.5% (transparent fee + mid-market rate) | Minutes to 1 day | Regular transfers; full transparency |
| Revolut (Standard) | 0.5-1% within allowance | Instant Revolut-to-Revolut; hours otherwise | Regular users; multi-currency holding |
| Western Union | 1-5% depending on amount/method | Minutes for cash collection | Cash collection in destination country |
| Remitly | 1-3%; promotional rates for new users | Express minutes; Economy days | Remittance corridors: India, Philippines, Nigeria |
| FX broker (OFX, Moneycorp) | 0.3-1% for larger amounts | 1-2 days | Transfers over £10,000; forward contracts |
| ⚠ Warning: Never use a money transfer firm not listed on the FCA register (register.fca.org.uk). Unregistered firms operating in the UK are illegal and your funds have no protection. |
Checking FCA Authorisation
All UK money transfer businesses must be authorised as a Payment Institution or registered as a Small Payment Institution with the FCA under the Payment Services Regulations 2017. Authorised Payment Institutions have stronger obligations including safeguarding customer funds separately from the firm's own money. Wise, Revolut and Western Union are all FCA-authorised. (Source: FCA Payment Institutions register)
Large Transfers — Over £10,000
For transfers above £10,000 (and especially above £50,000 — property purchases, pension transfers) specialist FX brokers offer significantly better rates than consumer apps. They also offer: forward contracts (lock in today's rate for a future payment); limit orders (automatic transfer when rate hits your target); and a dedicated account manager. Always confirm FCA authorisation before using any FX broker.
Anti-Money Laundering Checks
All FCA-regulated firms comply with the Money Laundering Regulations 2017. For larger transfers you will need: proof of identity (passport or driving licence); proof of address (utility bill, bank statement); and source of funds documentation (payslips, sale contract, investment statement). Have these ready to avoid delays. Transfers over £10,000 almost always trigger enhanced due diligence. (Source: HMRC — MLR 2017)
Best Providers by Corridor
| Destination | Best specialist providers | Note |
|---|---|---|
| India | Remitly, Wise, Azimo | High volume; competitive rates |
| Pakistan | Remitly, Western Union, Wise | Cash collection widely available |
| Nigeria | Remitly, Wise | Check recipient bank accepts international transfers |
| USA | Wise, Revolut | USD transfers fast and cheap |
| EU (EUR) | Wise, Revolut, Starling EUR account | SEPA transfers within EU are fast and low-cost |
| Australia | Wise, OFX | OFX strong for AUD large transfers |
| Disclaimer: This article is for information only and does not constitute financial, legal or tax advice. Figures correct at date of publication but subject to change. Always verify with primary sources (gov.uk, HMRC, FCA register) and consult a qualified adviser before making financial decisions. |
Frequently Asked Questions
Is my money protected if a transfer firm goes bust?
FCA-authorised Payment Institutions must safeguard customer funds separately from the firm's own money. If the firm fails, safeguarded funds should be returned to customers. This is not FSCS protection (which applies to bank deposits) — it is regulatory safeguarding under PSRs 2017, Regulation 23. FSCS does not cover money transfer firms.
What is a SWIFT code?
SWIFT codes (also called BIC codes) identify banks internationally. You need a SWIFT/BIC plus the recipient's IBAN for most direct international bank transfers. Consumer apps (Wise, Revolut) handle routing automatically — you typically only need the recipient's name and account details or email.
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