If you send money abroad and are not currently using a peer to peer money transfer service, it really is worth considering doing so. Here I explain how this form of money transfer works and give you some pointers to help you to find a good provider.
How the process works
Naturally, the process varies slightly from company to company, but for the most part this is how it works.
Once you have found an exchange firm you will need to register an account. In most countries to do so you will have to provide ID, proof of address and bank account details.
Add a payee
Once your account has been approved, you will need to add the details of the person or account you wish to send money to. At this point, you can place an order.
Your order will be taken and the best deal searched for. Peer to peer firms match buyers of currencies with sellers of currencies. They cut out the brokers and banks, which is one reason their service is so competitively priced. If there is nobody looking for the currency you want the exchange the firm will normally use their funds to carry out the transaction.
Once the currency firm has found a match, they will contact you again with the details of the deal. If the deal is good, you can move on to the next stage, if you are not happy you just move on and find another firm. At this stage, no money has changed hands.
If you like the deal details of the bank account, being used to fund your order will be sent to you. Normally you have a day or two to take up the deal and send the funds through. If you do not send the funds to the agreed timescales, the deal is taken off the table and you will need to start the process again.
Send money to payee
Once you have approved the deal, the funds will be sent to your payee or destination bank account.
Choosing the right firm
Provided you choose a good firm, the whole process is easy. However, the trick is choosing the right company. Here are a few tips to help you to do this.
The first step is to make sure that the firm you are planning to use is properly registered with the authorities and is fully regulated. Bear in mind that scammers can set up convincing websites that includes a registration number that has been skimmed from another firm’s site. For this reason, you should always go to the website of the regulatory body and double check the firm’s credentials there.
It also makes sense to do a quick search and find out what other users think of the firm you are planning to use. Review sites and forums can be helpful for this.
Transparent about their fees
Another sign that a firm is trustworthy is transparency about how much they charge. Most good firms tell you up front how much you will pay and their terms and conditions are clearly written and easy to understand.
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