The
report by FXCompared.com begins a regular monthly index measuring the effective
cost of shifting money through both banks and the money transfer companies that
have begun to put pressure on a business previously regarded as a big cash cow
for lenders.
The index measures the cost - including fees and
the spread to the central market rate at which banks trade currencies with each
other - for a range of transaction values and currencies. Those are gathered by
shopping expeditions at dozens of Canadian, U.S., Australian and UK banks and
brokers.
The new generation of web-based transfer firms have
poured cash into advertising highlighting the profit banks take when moving
money between accounts in different jurisdictions or currencies.
The results of the study show banks charge three or
four times more than such providers for transactions worth the equivalent of
1,000 pounds sterling. The charge drops to less than three times for
transactions over 10,000 pounds.
Costs in Canada are noticeably lower than in the
United States, where capital and regulatory barriers have made it harder for
broker-style operations like Transfer wise or World First to break through.
In the summer holiday months, costs at UK banks
were also a quarter less than the U.S. equivalents.
"With all of these fintech-style operations
out there, there has been pressure coming to bear on the banks," said
FXCompared Chief Executive Daniel Webber. "The UK is the place where the
banks have taken the biggest bashing on this issue.
"But we would also stress
that the difference does come down the further out the curve one goes on
transaction values."
Source : The
Fiscal Times
Time: 17:42
GMT
Date:
19/11/2015
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