I’ve been using Transferwise for about three years now. I don’t recommend things I’ve never used to others, otherwise I’d have talked about Transferwise on my blog before. I’ve made maybe 70 transfers with them by now, each of which went flawlessly. It’s a service I use regularly, and is convenient and efficient for helping manage my money, and saves me money.
Transferwise is a modern alternative for money transfer, usually overseas. With them you’re already saving *plenty* of money compared with traditional foreign exchange and banks, and then even more than rip offs like Western Union. They give you the actual market (mid) rate, and charge relatively small transaction fee.
Oh, and with Transferwise there’s none of that bullshit of fiddling the rate, so you don’t know you’re getting ripped off (So called “commission free” money exchange) – they don’t do that.
Most times my money has gone from my UK bank, to my Thai bank the next day, even when I’ve booked the transfer late in the UK day. Weekends and public holidays can slow things, so be aware of public holidays in both countries.
The Meat Of If – Making Free Money (Or Saving Money)
What I figured out, is that you can fix an exchange rate price, and then pay Transferwise within 24 hours. The thing is that the exchange rate may have changed over that period, possibly in your favour, or against you, either way you can potentially profit or save.
Example 1 – On 15-Jan-2020 @ 12:30, the GBPTHB rate is 39.50 – a day later the rate is 41.00. So, cancel the already booked transfer and start a new one, so you can take advantage of the new higher rate, and make free money. On 1000GBP at a gain of 1.5THB per pound (41 – 39.50), that’s 1500THB (around 38GBP) more, On 10000GBP that’s 15000THB (around 380GBP) more you’ve made free – *FREE MONEY*
Example 2 – On 15-Jan-2020 @ 12:30, the GBPTHB rate is 39.50 – a day later the rate is 38.00. So you pay Transferwise for the already booked transfer and you save losing money as the rate has dropped. On 1000GBP at a saving of 1.5THB per pound (39.5 – 38.00), that’s 1500THB (around 38GBP) saved, On 10000GBP that’s 15000THB (around 380GBP) saving – *MONEY SAVED*
So here’s the process,
- Check the rate and whether it it suits you – book your transfer, and don’t pay for it (tell them you’ll pay by bank transfer later). Write it down on a piece of paper (I use Post-It notes) so you have all the details – amount of both currencies, exchange rate, time you booked it and when the 24 hours will expire.
- Keep an eye on the exchange rate over the course of 24 hours. Google have exchange right in the search page, eg search Google “GBPTHB” or “USDAUD” or whatever.
- Then after 22-23 hours make a decision whether you will use the existing transfer you booked, or cancel it and create a new one. (I’ve found when transferring my money, from my UK bank to Transferwise it’s almost instant, but best to allow some time for money to be received by Transferwise)
In theory you may be able to continue this process for days, if the rate continues to rise in your favour, therefore compounding your profit. Even more free money.
In practice the differential rates may not be as spectacular as examples I’ve given. But it’s still possible to make or save some pounds/dollars/etc. Also bear in mind, that over the weekend, foreign exchange rates don’t usually change that much.
Bonus – Hedging (ie reducing your risk at times of uncertainty)
You could also use a similar system as a hedge, prior to major events. Let’s say there’s a general election (or referendum) being held in the UK, you’re not sure how the outcome will affect the value of the pound on the overseas markets. So on election day, you book your transfer, wait for the result of the election, then decide if you want to cancel/re-book for a better rate or pay for the transfer because the rate is now worse. Profit or save either way.
Or, another hedge example – there’s a US FED or Bank of England base interest rate decision to be announced later today. Book the money now, and decide what to do once you know outcome of the interest rate decision. (A country’s base interest rate is a fundamental driver in foreign exchange rates, in simple terms – the lower your country’s base rate, the lower your currency will be on foreign exchange markets)I’m sure there’s MANY other ways to take advantage of the way this works – the key is fixing the exchange rate you are paying for the 24 hours. Once you know this mechanism exists you can use it as an advantage – to profit or save money.
Transferwise where kind enough to give me a referral code for friends. You get your first transfer free, and I get some money back with each 3 people I refer. The little income that this will probably produce helps me make content on the blog, and therefore I’m grateful to you if you use it – https://transferwise.com/u/d3cbb2
Borderless Account And Mastercard Debit Card
If you don’t have a foreign bank account, and still want to use their service – ie you’re a tourist, frequent traveller, expat, backpacker, freelancer, digital nomad etc – then you can still use Transferwise for low cost foreign exchange and spending – use their free to open, ‘Borderless’ account, which comes with a Mastercard debit card, which you can use in foreign ATMs, pay online and in retail stores. Included with the Borderless account is your own UK/US/Euro/Australian/New Zealand/Polish local bank accounts which you can send/receive money from/to, plus you can store money in more than 50 other currencies.
For any of the Transferwise services – There’s no cost to signup, so if you feel you don’t like their service or find something better, just close your account. But my guess is, that if you often have to make these kinds of transactions and need these kinds of services, you’ll probably stick with them.
Don’t tell too many other people about how to make RISK FREE, FREE MONEY this way – the Transferwise guys may change their processes at any time !
Hope it’s helpful.
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