Cross Border Payments

As it stands, the European directive on cross-border payments states that payment transfers between countries can cost no more than a domestic euro transfer in the country of origin. But this applies only to countries where the euro is the denomination of currency.

As the UK is not in the eurozone, cross-border euro payments will always attract charges. Some banks are more competitive than others and it always pays to shop around for a bank that may offer a more competitive rate.

However, the way to minimise the charges when you transfer money to Europe would be to tell your bank in the UK that you want to pay ALL the charges, i.e. those at both ends of the transaction. The receiving bank will not then levy charges. Secondly, you should quote the international bank account numbers (IBANs) for both accounts (which your respective banks will allocate). This will ensure that your payment is processed electronically where possible and may assist in the transaction being priced slightly lower.

APACS is the UK payments association and as such we can only give advice about what happens to money transfers before they leave the UK or when they arrive in the UK.

Your bank may or may not have a correspondent bank in the receiving country. If they do, then your request to transfer funds from your bank to another will be sent via SWIFT (the electronic messaging service) directly to that correspondent bank. How long it will take before the funds are credited very much depends on the payment system in the country where the funds have been sent. It is always best to ask your bank how long they envisage the transfer will take.

If your bank doesn't have a correspondent bank in the receiving country, then they will send the funds to another UK bank which does. Unless you request your bank to use CHAPS (the same-day value system) for this domestic transfer, they will transfer the funds via Bacs. This process will take three days, after which the funds will be transferred out of the UK.

When the payment reaches the UK, the length of time it takes before reaching and being credited to your account very much depends on the instruction given to that payment. If the sender of the transfer asked for the funds to be sent same-day then when the funds reach the UK they will be sent to your bank via CHAPS. If no instruction has been given, they will be sent via BACS which takes three working days.