There are many reasons why you might need to send money to Australia. Perhaps you are running a business, investing in property, or paying for university tuition. Or maybe, you are one of the thousands of expats who relocate to Australia each and every year.
Whatever the reason, you’ve probably realised that moving money to Australia is more complicated than you first thought. And, you may have also noticed that if you are using your bank, it’s very likely that you’re paying more than you should for the privilege – up to 5% of the transfer value in many cases!
I ran into the same thing a couple of years ago, when I moved overseas. So in response, I prepared this guide to help you navigate through the chaos. Read on and I’ll show you how to get the best exchange rate when you transfer money to Australia; and with a bit of luck, we’ll save you some money along the way.
Table of contents
- Do the banks offer a good deal on foreign exchange?
- Why dedicated money transfer services the best way to send money abroad
- Case study: How to send money to Australia from USA
- How do money transfer services work?
- Selecting the right money transfer service for you: A 7 point checklist
- What happens next? Getting started with your service of choice
- Appendix: Best services for popular currency routes
Do the banks offer a good deal on foreign exchange?
The short answer is no. Let me explain why.
Let’s assume, for example, that we’d like to send money to Australia from the USA. In other words, we would like to exchange US Dollars (USD) into Australian Dollars (AUD) and transfer the money to an Australian bank account.
To begin to understand the money transfer landscape, we should first take a look at the exchange rates offered by traditional banks, and compare this to the mid-market rate. The mid-market rate is a theoretical exchange rate which provides us with a benchmark that we can use to compare all other services. It is unlikely that we will ever get this price exactly – after taking into account fees and expenses – however, our aim is to get as close as possible.
Above, we can see the mid-market rate for exchanging USD into AUD is 1.2603 according to xe.com. Now, let’s compare this to the price offered by a few traditional services.
|Service||USD/AUD||Fee||USD 1,000||Total cost||Time|
|Mid-market rate||1.2603||AUD 1,260|
|HSBC||1.2330||USD 20||AUD 1,214||AUD 46||1-2 days|
|Western Union||1.2138||USD 5||AUD 1,207||AUD 53||7 days|
|PayPal||1.2061||USD 10||AUD 1,194||AUD 66||3 days|
As you can see, the rates offered by some of the incumbent services are a long way off the mid-market rate. For example, the least competitive of the bunch, PayPal, offers a rate which is about 5.5% less than the mid-market rate. To put that monetary terms, approximate AUD 66 of every USD 1000 is being lost in fees and charges.
What we can take away from this is that incumbent services will clip the ticket on any transfers made directly with them, and you are potentially leaving a lot of money on the table if you do not consider other options. However, the good news is that there are many currency transfer companies which aim to close this gap and provide better value for their clients. And while they may be a little hard to find at first, with a little bit of research you can ensure that you are getting a much better deal.
Why dedicated money transfer services are the best way to send money abroad
Every currency exchange service is slightly different from the next and each will offer a variety of features. At the very least, most will provide an easy to use online platform that allows you to be in control of exactly what you want to do when you want to do it, and many will offer a personalised service for larger transactions.
Some services are specialists at moving small amounts of money quickly, while others may take longer, but offer a better deal to compensate. Whichever is best for you will depend on your particular circumstances, so before getting started, it’s a good idea to at least have a grasp of what’s available.
Personally, I live and work in Germany, and send money to Australia every couple of months. First and foremost, I want to transact with a reputable company. Following that, I’d like a competitive price, as well as an easy to use online platform. I don’t mind if transactions take a couple of days as long as I am adequately informed along the way. Finally, I don’t want to chop and change services every time I want to send money; so consistency is important.
Let me show you how to get the best bang for your buck.
Case study: How to send money to Australia from USA
Now that we know that the banks aren’t going to provide you with a fair deal, and that currency transfer services are going to provide a better service, where does this leave us?
In the case study below, I highlight my 3 favourite ways to transfer money to Australia from the US. While this example focuses on an exchange between USD and AUD, I have found that the comparison holds true with many other currency pairings as well. Following my selections, I stack up all the services in the market so you can understand the lay of the land, and compare each company’s rates alongside its estimated delivery time and aggregate rating according to Trustpilot.
My top 3 picks
Best for: Low-value transfers up to AUD 2,000.
TransferWise is my recommendation for the best service provider of low-value transfers to Australia. The London-based company has been operating since 2011 and has made large strides to make consumers aware of the exorbitant fees charged by major banks. TransferWise offers transfers to Australia for approximately 0.7% of the transfer value for many common currency pairings. It provides its customers with a user-friendly online platform and supports over forty currencies.
The company completes over GBP 500 million of transfers on behalf of its customers every month and has a customer service team available on hand to assist with phone queries during standard business hours. TransferWise has received over 38,000 positive reviews on Trustpilot and I have had personal success with the service over the past 3 years. For a step-by-step guide on how to get started with TransferWise, check out my complete review.
Best for: High-value transfers over AUD 2,000.
CurrencyFair is my recommendation for the best service provider of high-value transfers. Located in Dublin, CurrencyFair has been operating since 2010 and has developed an excellent reputation. CurrencyFair offers transfers to Australia for approximately 0.35% of the transfer value from most large currency pairings, plus a GBP 3 fee. It provides its customers with a slightly more sophisticated online platform, allowing users to access a dynamic foreign exchange marketplace.
The company is regulated in each of the jurisdictions in which it operates, and has a customer service team based in the Ireland and Australia, ready to respond to customer queries as they arise. CurrencyFair has completed over EUR 5 billion transfers on behalf of its customers since inception and has received over 2,000 positive reviews on Trustpilot. I have personally had excellent experiences with this service for large transfer amounts, and have analysed CurrencyFair’s offering in a full review.
Best for: Full-service foreign exchange with a large selection of currencies.
OFX is one of the largest players in the foreign exchange industry and is a listed company on the Australian Stock Exchange. It has facilitated approximately GBP 50 billion worth of transfers since its inception in 1998. OFX was previously well known by a number of trading names such as OzForex, UKForex and CanadianForex, before consolidating into a single global brand in 2015.
The company handles over 3,000 transfers daily and offers its customers access to 55 currencies from around the world. Due to OFX’s size and international footprint, customer service is available 24 hours a day, seven days a week. OFX provides excellent rates and has such a such a strong presence in the market, that it is used by many other large operators, such as Travelex and MoneyGram, as a wholesale facility. The company has over 2,200 positive reviews on Trustpilot.
Complete market comparison
|Service||USD 1,000||USD 10,000||USD 100,000||Time||TrustPilot|
|Mid-market rate||AUD 1,260||AUD 12,603||AUD 126,030|
|Xoom||AUD 1,251||AUD 12,512||1-2 days|
|CurrencyFair||AUD 1,249||AUD 12,527||AUD 125,239||4 days|
|Smart Currency||AUD 1,248||AUD 12,487||AUD 124,879||2-3 days|
|Xendpay||AUD 1,248||AUD 12,572||AUD 125,727||2-3 days|
|MoneyCorp||AUD 1,247||AUD 12,528||AUD 125,543||1 day|
|TransferWise||AUD 1,247||AUD 12,494||AUD 125,105||3-5 days|
|HiFX||AUD 1,244||AUD 12,528||AUD 125,417||3-5 days|
|Currencies Direct||AUD 1,242||AUD 12,555||AUD 125,681||1-2 days|
|Ria Money Transfer||AUD 1,241||3-5 days|
|Tranzfers||AUD 1,240||AUD 12,457||AUD 125,143||3-5 days|
|OFX||AUD 1,237||AUD 12,445||AUD 126,019||1-3 days|
|1st Contact||AUD 1,234||AUD 12,431||AUD 125,136||3-5 days|
|World First||AUD 1,228||AUD 12,478||AUD 125,543||3-5 days|
|TorFX||AUD 1,228||AUD 12,519||AUD 125,446||1-2 days|
|Kantox||AUD 1,223||AUD 12,563||AUD 125,635||1-2 days|
|MoneyGram||AUD 1,212||1 day|
|Skrill||AUD 1,205||AUD 12,077||AUD 120,769||3-5 days|
|Halo||AUD 125,543||3-5 days|
|Currency Solutions||AUD 12,519||AUD 125,194||1-3 days|
|Compass Markets||AUD 12,569||AUD 125,572||1-2 days|
|Venstar||AUD 12,496||AUD 125,094||1-3 days|
|Rational FX||AUD 12,494||AUD 124,942||1-3 days|
|Effective FX||AUD 12,544||AUD 125,572||1 day|
|FairFX||AUD 12,532||AUD 125,547||1-2 days|
|Investec||AUD 125,446||1-2 days|
How do money transfer services work?
As we’ve seen, currency exchange services are a great way to send money to Australia. But you may be wondering on how they achieve such low rates? While these companies may still access the foreign exchange markets as traditional brokers, many now look to establish a size where they have enough deal flow to simply exchange currencies between their existing clients.
As a client, what this means is that instead of making a transfer directly through your bank to your intended recipient, currency transfer services require you to send your funds to their own bank accounts at the country of origin. This allows them to facilitate the necessary exchange, and to eventually deliver the new currency into your recipient’s account.
In essence, by attracting many clients to their platform, currency services can use your transferred funds to facilitate the exchanges of their other clients and use their funds to provide to you. That way, unless a transfer is particularly large, they won’t need to access the broader foreign exchange market, and instead, the service itself becomes a marketplace for clients to exchange between each other.
Now, what should you consider when weighing up your options?
Selecting the right currency exchange service for you: A 7 point checklist
Once you’ve reviewed a comparison of the available services based on exchange rate, estimated time to complete a transfer, and reputation according to Trustpilot, you might be wondering what else you should consider when considering your options. Below is a checklist to refer to before committing.
1. Does the service offer a competitive rate?
Currency services earn their revenue through charging a fee on each transaction, a percentage of the value exchanged, or a combination of both. When comparing services, take a look at the total cost involved, and consider which one will provide you with the best value.
2. Is the transfer speed acceptable?
The time required for each service to complete your transfer will vary, and most provide an indication of this on their website. If you need a fast exchange, you may need for forego a better rate, while being prepared to wait a few days can result in a better exchange rate.
3. Is the service reputable?
Research a company’s reputation ahead of time can save you a lot of hassle in the long run. Take a look at a review aggregator website such as Trustpilot, to see what previous customers have said about their experience.
4. Does the service offer the features you require?
Not all companies offer the same features. Make sure that any service offers what you need before committing to the sign-up process. Think about the types of features that will make your life easier, such as:
- Scheduling regular payments
- Locking in future rates to hedge against volatility
- The service’s ability to hold your funds in trust for a certain period of time
- Adequate minimum and maximum transfer values
5. Does the service have a secure website?
Any company you choose to business with on the internet should have a secure website. To check that a company is complying with secure communication standards, check that their website URL begins with https://.
6. Is the service appropriately regulated?
Any reputable currency service should be registered with the relevant financial regulators in the countries from which it operates. For example, TransferWise is regulated in the UK by the Financial Conduct Authority, and in Australia by the Australian Securities and Investments Commission.
7. Is customer support easily accessible?
Just in case you get stuck when using the online platforms of currency services, it is nice to know that help isn’t far away. Make sure that you can locate the telephone number for customer service to ensure that you have access to support if it’s needed.
What happens next? Using your service of choice
While each currency service is distinct in its own way, most have a common onboarding process. As these type of services fall within the larger banner of financial services, in many cases you will need to provide documents to verify your identity before getting started. But once that’s done, it’s smooth sailing.
Here is a summary of what to expect:
- Sign up with your currency service of choice
- Verify your identity with documentation as requested
- Log in and commence your transaction
- Deposit money into the service’s local bank account
- The service delivers your funds to the intended recipient
See, I told you it was easy, didn’t I? Great job!
Hopefully, by now you have a better understanding of how to send money to Australia, and how you can use currency services to ensure you are getting a better deal than offered by traditional banks and incumbents.
I hope you found this guide useful and saved a few bucks along the way. If you have any questions or feedback, please let me know in the comments below.
Appendix: Best services for popular currency routes to Australia
Want to know the best ways to transfer money to Australia from a specific location? Below, I outline the top 5 currency exchange services when sending money to Australia along some of the most popular foreign exchange routes.
Country of origin
Best way to send money to Australia from Canada
The top 5 services to exchange Canadian Dollars (CAD) to Australian Dollars (AUD).
|Service||CAD 1,000||CAD 10,000||CAD 100,000||Time||TrustPilot|
Best way to send money to Australia from China
The top 5 services to exchange Chinese Yuan (CNY) into Australian Dollars (AUD).
|Service||CNY 5,000||CNY 50,000||CNY 500,000||Time||Trustpilot|
|FC Exchange||AUD 943||AUD 9,434||AUD 94,345||1 day|
|World First||AUD 942||AUD 9,420||AUD 94,203||1 day|
|TorFX||AUD 942||AUD 9,416||AUD 94,156||1 day|
|OFX||AUD 941||AUD 9,406||AUD 94,127||1-3 days|
|Effective FX||AUD 9,415||AUD 94,250||1 day|
Best way to send money to Australia from Europe
The top 5 services to exchange Euro (EUR) into Australian Dollars (AUD).
|Service||EUR 1,000||EUR 10,000||EUR 100,000||Time||Trustpilot|
|OFX||AUD 1,476||AUD 14,770||AUD 147,834||2 days|
|TransferWise||AUD 1,473||AUD 14,740||AUD 147,621||3-5 days|
|CurrencyFair||AUD 1,471||AUD 14,754||AUD 147,560||3-5 days|
|World First||AUD 1,460||AUD 14,740||AUD 147,711||1-3 days|
|FairFX||AUD 14,771||AUD 147,889||2 days|
Best way to send money to Australia from Hong Kong
The top 5 services to exchange Hong Kong Dollars (HKD) into Australian Dollars (AUD).
|Service||HKD 6,000||HKD 60,000||HKD 600,000||Time||Trustpilot|
|World First||AUD 965||AUD 9,591||AUD 96,059||1-3 days|
|OFX||AUD 964||AUD 9,647||AUD 96,083||1-3 days|
|MoneyCorp||AUD 958||AUD 9,616||AUD 96,376||1 day|
|Currencies Direct||AUD 953||AUD 9,639||AUD 96,494||1-3 days|
|TorFX||AUD 943||AUD 9,598||AUD 96,083||1-3 days|
Best way to send money to Australia from India
The top 5 services to exchange Indian Rupee (INR) into Australian Dollars (AUD).
|Service||INR 50k||INR 500k||INR 5m||Time||Trustpilot|
|Skrill||AUD 947.71||AUD 9,478||AUD 94,779||3-5 days|
|Currency Solutions||AUD 9,842||AUD 98,527||3-5 days|
Best way to transfer money to Australia from Japan
The top 5 services to exchange Japanese Yen (JPY) into Australian Dollars (AUD).
|Service||JPY 80k||JPY 800k||JPY 8m||Time||Trustpilot|
|TransferWise||AUD 924||AUD 9,243||3-5 days|
|MoneyCorp||AUD 915||AUD 9,191||AUD 92,072||1 day|
|HiFX||AUD 913||AUD 9,191||AUD 91,970||3-5 days|
|OFX||AUD 905||AUD 9,121||AUD 91,744||3-5 days|
|FairFX||AUD 905||AUD 9,206||AUD 92,104||3-5 days|
Best way to transfer money to Australia from New Zealand
The top 5 services to exchange New Zealand Dollars (NZD) into Australian Dollars (AUD).
|Service||NZD 1,000||NZD 10,000||NZD 100,000||Time||Trustpilot|
|OFX||AUD 918||AUD 9,189||AUD 92,017||2 days|
|TransferWise||AUD 915||AUD 9,151||AUD 91,753||2 days|
|CurrencyFair||AUD 914||AUD 9,180||AUD 91,836||2 days|
|OrbitRemit||AUD 911||AUD 9,168||2 days|
|FairFX||AUD 9,193||AUD 91,949||3-5 days|
Best way to transfer money to Australia from Singapore
The top 5 services to exchange Singapore Dollars (SGD) into Australian Dollars (AUD).
|Service||SGD 1,000||SGD 10,000||SGD 100,000||Time||Trustpilot|
|TransferWise||AUD 919||AUD 9,190||AUD 92,095||2 days|
|OFX||AUD 918||AUD 9,208||AUD 92,247||2 days|
|Frontierpay||AUD 918||AUD 9,225||AUD 92,332||3-5 days|
|FairFX||AUD 904||AUD 9,225||AUD 92,290||3-5 days|
|Currency Solutions||AUD 9,224||AUD 92,323||3-5 days|
Best way to transfer money to Australia from Thailand
The top 5 services to exchange Thai Baht (THB) into Australian Dollars (AUD).
|Service||THB 25k||THB 250k||THB 2.5m||Time||Trustpilot|
|FairFX||AUD 944||AUD 9,440||AUD 94,144||1-2 days|
|OFX||AUD 943||AUD 9,440||AUD 94,400||1-3 days|
|Currency Solutions||AUD 941||AUD 9,414||AUD 94,144||1-3 days|
|Currencies Direct||AUD 939||AUD 94,239||AUD 94,239||1-3 days|
|TorFX||AUD 923||AUD 9,396||AUD 94,057||1-3 days|
Best way to transfer money to Australia from UK
The top 5 services to exchange Great British Pounds (GBP) into Australian Dollars (AUD).
|Service||GBP 1,000||GBP 10,000||GBP 100,000||Time||Trustpilot|
|TransferWise||AUD 1,618||AUD 16,155||AUD 161,677||1 day|
|OFX||AUD 1,618||AUD 16,188||AUD 161,994||1 day|
|CurrencyFair||AUD 1,615||AUD 16,170||AUD 161,795||2 days|
|HiFX||AUD 1,608||AUD 16,154||AUD 161,762||1 day|
|FairFX||AUD 16,189||AUD 162,054||1 day|