Is CurrencyFair the cheapest method to transfer money online?


currencyfairlogoCurrencyFair Hidden Costs : Analysis of Cost, Speed, Hassle and Risk

  • Overview :
    • CurrencyFair is a peer to peer company that would buy currency from the user if there is nobody to exchange it
    • In Canada it is not possible to accept residents in Quebec.
    • documents verification (takes >7 days)
  • Requirements :
    • Email and residency in certain countries
  • Limitations  :
    •  If you are in Quebec Canada you cant create account
    • Even if you want to exchange in the same country the funds should go first to UK or Dublin then wired back
    • Credit Card withdrawal:   Not Possible.

 

Testing Sending transfer from Canada to Dubai, this would require the following process and cost:

  •    Speed:
    • 2-3 Days to deposit and 4-5 days to withdraw the funds (Total of 7 business days)
  • Cost:
    • CAD$ should be first transferred to a Dublin CurrencyFair account  in Canadian Dollar and international wire transfer from local bank would usually cost $25
    • Currency Fair would charge 0.35 from  the amount (the currency exchange fee would be $3.5 for $1000 exchange , however if it is $10,000 the currency exchange fee would be $35)
    • Also CurrencyFair would charge US$ 4 for transferring the funds (for UAE Dirhams its transferred from London)
    • The third party receiving bank or intermediary bans most usually would charge $20 – $30 for the wire transfer
  •     Hassle:
    •  To open an account, you need one proof of residency, and two proofs of ID (took almost 7 days to verify documents).
    • Hassle (Uploading funds) : Require making wire transfer , can be done using the site without going to the bank.
    • All Transactions would require sending funds to banks in UK or in Europe and the funds are transferred from there to other countries
  • Potential:
    • Can have a cheaper exchange rate than XE.com in some cases where the other peer is willing to exchange at lower than market price, however the fund wire fees can eat al the benefits
    •  CurrencyFair would exchange the required amount if there are no peer in the market they would however charge a higher exchange fee than the one available
  • Risks :
    • N/A
  • Testing Results:
    • N/A

 

  • Conclusion:
    • Not applicable as it requires international wire transfers
    • Although Exchange rates can be very competitive , any benefits are eaten by the international wire transfer fees