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If you’re living or visiting a foreign country, you’re likely to need to send money overseas at some point. From New Zealand, an international money transfer (IMT) can also be called a telegraphic transfer, and it’s relatively simple to do. However, there are some tips, tricks and processes you’re going to want to familiarize yourself with in order to make your transfer go as smoothly as possible, avoiding charges and delays. This guide should tell you what you need to know.
But first, here’s a quick example.
Let’s say you need to transfer NZ$1,000 to a euro account in Germany. Here’s what that transfer would look like if you ordered a telegraphic transfer through one of New Zealand’s biggest banks, BNZ, versus moving money with an alternative service like Wise.
|Provider||Fee||Exchange Rate||Total Cost|
|BNZ¹ (New Zealand)||NZ$15, plus a $25 transfer fee||Exchange rate + possible markup||NZ$40 + possible exchange rate markup + likely fees from intermediary and recipient banks|
|Wise||NZ$23.34||The real exchange rate - the same one you find on Google||NZ$23.34|
You can see that it appears to be more expensive to transfer money using BNZ than Wise. Many banks charge substantial fees to make international transfers, and that doesn’t even take into account the fact that banks often mark up their exchange rates by an average of 4-6%. Add in the 1-3 intermediary and recipient banks who can also each charge fees, and you’re looking at one expensive telegraphic transfer. Wise may be a better alternative.
How you make a telegraphic transfer from a bank in New Zealand will ultimately depend on the bank you use to make the transfer, as they all have different steps and processes for moving money internationally. But these steps should at least get you started.
Some banks will allow you to make telegraphic transfers online, by mobile app, by phone, by fax, email, or by mail. Others will only allow you to transfer money internationally if you request it in person in a branch. You’ll have to contact your bank or check its website to see what’s available to you. Don’t forget to pay attention to the difference in fees for the available choices as well. Sometimes banks might charge you more for an international transfer made over the phone, or in a branch, for example.
Again, every bank has different requirements, so you’ll want to call or do some research to find out for sure what you need. But at the very least, you’ll likely need:
- Your full name, address and account number
- The amount and currency you want to send
- The recipient’s full name and address, the name of their bank and their account number
- Depending on where the transfer is going, you’ll need an International Bank Account Number (IBAN), Clearing Code or SWIFT/BIC Code. This SWIFT/BIC Code guide should help.
International transfers can come with a whole host of fees. The following are the most common.
Banks general charge a flat fee for making a telegraphic transfer, like BNZ’s NZ$15-25 fee shown at the beginning of this article.1 These fees vary depending on which bank you use and what kind of transfer you want to send — sometimes fees are lower if you order your transfer online versus in a branch. In the example with BNZ, NZ$15 is charged for a transfer made online and NZ$25 for one made in a branch.
Sometimes banks also offer the possibility to have your telegraphic transfer delivered sooner than the bank’s standard delivery time, for an additional fee.
When you send a telegraphic transfer to a country that uses a currency other than New Zealand dollars, the transfer will need to be converted into the currency used by the destination bank.
Often, when banks convert currency, they don’t do so at the mid-market exchange rate, or the rate you see on Google. Instead, they give you their “rate of the day” or a “buy and sell rate” which simply means they add a commision on top of the mid-market rate - which can be as high as 4-6% - so they can make a profit on the conversion.
To find out if you’re getting a good deal, compare your bank’s exchange rate to the mid-market rate using an online currency converter.
Most international bank transfers are done via the SWIFT system, which means your payment is likely to pass through 1-3 intermediary banks on its way to its destination. Each of these banks may charge a fee that’s deducted from the transfer amount, meaning the amount that arrives in the recipient’s account will be less than what you sent.
Intermediary fees vary, so you’ll have to talk to a representative at the bank you’re using to send the telegraphic transfer to see if they can give you an idea of what kinds of fees to expect.
Another option is to use Wise, which moves money at the exact mid-market rate with no markups. Because Wise uses a network of local bank accounts in the countries they operate in, they’re able to move your money without having to use any intermediary banks, which also means there are no intermediary fees. Your small, fair transfer fee is spelled out up front, so you always know what you’re paying for your international transfer.
If you have to make regular international transfers, or if you need to receive payments in EUR, GBP, AUD or USD, than you can also consider opening a Wise borderless multi-currency account. This feature allows you to manage your money in more than 40 different currencies. For the above mentioned 4 currencies you can get your own local, virtual account details, which means you can receive payments like a local.
Moving money across borders doesn’t have to be as complicated as it seems. With this guide, hopefully, you have a better idea of what to expect. Good luck, and safe travels!
1https://www.bnz.co.nz/support/rates-and-fees/essentials/service-fees#int (February 8 2018)
|This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.|
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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