The main Australian banks are: National Australian Bank, Westpac, Suncorp, Commonwealth, ANZ and St. George. Each one operates in a different way.
The other surprise is that they all have different charges for credit cards, paying bills or using an ATM.
- There are two main types of bank accounts – Savings Accounts (pays interest) and Cheque Accounts (has a cheque book).
- To open a bank account, you will need to meet the 100 points system – the number of points varies for different ID documents, e.g. passport = 70 points. Check with the bank what is needed.
- If bringing money into Australia – amounts of more than AUD10,000 in cash must be reported to Australian custom officials. Keeping your money overseas does not exempt you from paying Australian tax on it either – so you have been warned that they might tax you (top rate of tax is 45%).
Sending Money Internationally with Banks
In the even that you want or need to send money to or from Australia, the bank could be your worst enemy. And there are many reasons why, but the main three are:
- Big fees.
- Bad currency exchange rates.
- It’s inconvenient.
Banks are notorious for charging a lot and for almost anything. If you think about it, more people are sending money through Western Union than banks when making international money transfers; and everybody knows that Western Union charges a lot of money. According to their price estimator, for a transfer of $1,000 you have to pay a $25 fee.
Bad currency exchange rates
This is where the banks can really steal you from a lot of cash because they always provide a bad currency exchange rate. And depending on the amount you want to exchange, it can mean serious money. After all, that’s why there is an entire market of Currency Exchange shops around every corner in every city, in every country.
In order for you to make an international money transfer, you will need to loose time by going to the bank. After that, depending on your luck, you might or might not wait to a line before getting to the counter. Than you need to get your ID checked, complete paper work, wait for signatures and so on. And when everything is done, wait between 3 to 5 working days for money to be in the receivers bank account.
Sending Money with FX Companies
Foreign Exchange (FX) companies have been getting more and more exposure and clientele in the recent years because of their disrupting impact in to the banking sector. Some of them even have big banks as investors, and that’s saying something about the future of money transfers.
The same we showed you the cons of using banks, the same we will show you the pros of using FX companies:
- Small fees or even zero fees.
- Great currency exchange rates.
- It’s easy and convenient.
So let’s delve into and expand on this reasons and how the emerging of Foreign Exchange companies has changed the market for the best, for the consumer at least:)
Small fees or even zero fees
Most of the FX companies have very low fees that range between $1 and $5. But many will exclude the transaction fee altogether if the transferred amount is above certain numbers. Every company has it’s own bonuses and fees structure so I encourage you to check them out before committing to one.
Great currency exchange rates
This is where they real money resides and this where their service is a level above your usual banks. Because their volumes are huge, they have access to the same interbank exchange rate that the High Street banks work with. That is why you always see a big difference between the exchange rates shown on Google and the rates of the banks.
The FX companies provide better exchange rates by taking a smaller margin and get closer to the Interbank foreign exchange market rate. The difference in your pocket will be higher and higher when the amount that you want to send is getting bigger and bigger.
It’s easy and convenient
Beside the money aspect, more and more people are falling in love with this companies because you can create an account and make a transfer in minutes, from your laptop and from the comfort of your own home. And if you go a little further, you can download their mobile app (almost all the companies have a functional app) and do the same while you’re on the move.
For the benefits listed above and many others, I encourage you take a few minutes and research this companies next time you need to send money abroad. A great resource for that is SendMoneyAustralia.com.