TorFX Fees: What’s the price of a money transfer?

There are lots of different options out there if you need to make an international money transfer, either as a remittance home, or for your business. That can mean that choosing the right service for you can be tricky. You’ll need to work out the costs and processes used by different providers, to see which can work for you. If you’re considering using TorFX for an international payment, we’ve got you covered.

This guide contains all you need to know about the payment services available, and also gives an alternative provider to consider for comparison - Wise. Wise international payments all use the exchange rate you find on google, with just a small transparent fee - making them simple to use, and often cheaper than alternatives too. You can also get a Wise borderless account to make cross border payments even easier. More on that later.

Who are TorFX?

TorFX was established in 2004, and provides currency services to personal and business customers. Over the past 15 years, TorFX has worked with over 55,000 customers, moving money all around the world and across different currencies for them¹.

The company is licensed in Australia and also has offices in locations including the UK, Europe, the US and China.

What are the fees for sending money internationally?

TorFX does not charge an upfront fee for their service. Instead, they make their profit by adding a markup or margin to the exchange rate they offer customers³. That makes it really important to check the exchange rate quote you’re offered by TorFX against the mid-market exchange rate, to make sure you’re happy with the deal on offer for your currency. We’ll cover that more in a moment.

Another potential cost you’ll need to know about is intermediary fees, which may be known as third party charges or correspondent bank fees. These usually appear when your payment is processed using the SWIFT network.

The SWIFT network is a common way to move money from one account to another, across country borders. It involves a series of banks - known as intermediaries - working together to make sure the payment ends up in the right place. It’s a well established system - but can mean you run into extra fees, as each intermediary bank may charge a fee of their own for the service they offer.

Here’s what TorFX say about intermediary fees in their terms and conditions:

“Although TorFX aims to avoid having additional third party fees deducted from your funds in some cases it is unavoidable. This may result in an amount less than you transferred arriving at the Beneficiary Account. TorFX does not either levy or receive these fees and is constantly looking for ways to enable our customers to avoid them.”³

One of the biggest problems with intermediary fees is that TorFX won’t necessarily be able to tell you in advance if they will be charged, or how much it might cost you. Depending on where you’re sending money to, there may also be a recipient fee applied by the recipient’s own bank. Again, TorFX can’t necessarily predict this cost, which can mean your recipient gets less that you expect them to in the end.

If you avoid the SWIFT network when you send money internationally, you can limit the risk of extra costs like these. Some TorFX payments do not use the SWIFT network - but this depends on where you’re sending money, and in which currency. Check in advance, so you know whether or not you’re likely to hit additional costs. Or choose an alternative provider such as Wise which uses a different approach to avoid the SWIFT network for most transfers. More on that - and the handy Wise borderless account in a moment.

What exchange rate is used by TorFX when converting your funds?

TorFX makes its money by using an exchange rate markup or spread. This means is that they don’t pass on the exchange rate they get when buying currency - the interbank, wholesale or mid-market exchange rate - to their customers. Instead, they add a markup, which they then keep as profit. Here’s what they say about it in their Product Disclosure Statement:

“TorFX does not charge any direct fees for a FX contract. TorFX derives a financial benefit by offering a rate to clients which applies a spread. The spread may be considered to be the difference between the Interbank or Wholesale Rate and the rate we quote you. If you are comparing rates, you should bear in mind that an attractive exchange rate may be offset by a high transaction fee (or vice versa).”³

It’s not uncommon for currency services to add a margin or spread to the exchange rate they use. However, this can make it hard to see what you’re actually paying for the service you need, as the fee is wrapped up in the exchange rate.

To work out the fee you’ll pay to TorFX, you need to know the markup added to the mid-market exchange rate. You can do this by finding the mid-market rate through a simple google search and comparing it to the quote you get from TorFX.

If this sounds like a hassle - or if you just want to compare the options out there, it’s good to know that not all international payment services work like this. Some, like Wise, pass on the mid-market exchange rate to their customers, and charge a transparent fee for the service they’re providing. This can make it easier to see what you’re paying, and can work out cheaper too.

You can also get a Wise borderless account to make managing your money across different currencies simple. You’ll be able to hold any of dozens of different currencies in the same account, and benefit from currency conversion using the mid-market rate, with just a low upfront fee. Open an account online to send and receive payments around the world, and switch your balance back to dollars to withdraw it to your local account whenever you want to.

What is the real cost of transferring money with TorFX?

To get the price for a transfer through TorFX, you’ll need to create an account and then apply for a quote for the specific transfer you’re interested in carrying out.

Don’t forget to check out the costs, taking into account:

• Exchange rate markup or spread
• Potential intermediary fees if send using the SWIFT network
• Recipient bank fees if relevant

Compare the quote you get from TorFX to other options out there, to make sure you’re getting the best possible deal. The Wise borderless account is a great alternative for many customers, allowing you access simple low cost international payments with Wise. You’ll get local bank details to receive payments for free in major currencies like euros, pounds and US dollars, and you can conveniently send, spend and receive money whenever you need to. See if you can save money on your international transfers, with Wise.

Sources:

All sources accurate as of 22 April 2019