Is Your Bank Telling You Everything? 75% Of Singaporeans Don’t Know The True Cost Of International Paymentsby Company Announcement December 13, 2017
According to new research released today by online money transfer service TransferWise, a majority of Singaporeans who transfer money overseas use their bank but three in four people don’t know the true cost of sending money overseas – which includes both upfront fees and an exchange rate markup.
Singaporeans prize transparency of fees when they send or receive money abroad, and many believe their banks have been clear about the costs. The survey revealed that close to 75 percent of people believe banks make it easy to understand the true cost of overseas money transfers. However, 88 percent of Singaporeans underestimate how much fees are charged for an overseas money transfer.
TransferWise Head of Banking, Lukas May said,
“Singaporeans are savvy consumers. These complex fees for international money transfers hide important information from consumers and Singaporeans don’t get the most value out of their transactions – whether they are sending money to support loved ones abroad or investing overseas.”
“On a scale of what matters most to them when transferring money, more than half of Singaporeans ranked transparency regarding fees and charges more highly than price.
“However, our research has found that people in Singapore are not aware of hidden costs of international payments. In fact, Singaporeans could be paying up to five times more than necessary when making money transfers abroad”
Research by TransferWise also included price comparisons for money transfers from Singapore to abroad across the major financial institutions, which revealed that on average Singapore banks charge S$30-40 for upfront fees and exchange rate markup for an overseas transfer of S$1,000.
In particular, Development Bank of Singapore (DBS) is the cheapest of major bank providers when accounting for upfront fees as well as exchange rate markups. Whereas Standard Chartered and HSBC are the most expensive.
Payments company PayPal has the highest exchange rate markup compared to all other providers – more than 4 percent across all routes and transaction amounts. Citibank is the bank that offers the highest exchange rate markup for overseas money transfers.
The research also revealed that it was most expensive to send money to India, followed by Australia and then Hong Kong, across all amounts of money to transfer.
“Many banks tell their customers they only pay a small upfront fee for international payments, but in reality, customers pay much more through poor exchange rates.
“We want to equip customers with all the information they need so they can pick the most transparent, secure and cost-effective option when making overseas money transfers, especially as more Singaporeans are traveling and living abroad.”
TransferWise’s research found that its overseas money transfer service is five times cheaper than banks and PayPal across all routes around the world on a S$1,000 transaction. For example, sending S$1,000 to the UK costs $5.86 with TransferWise, as compared to S$40.71 with a bank on average.
TransferWise offers international transactions based on the real, mid-market exchange rate.
Featured image via Transferwise Facebook page