Hello.I am Papazon (@nomadkazoku) of the Nomad family.
When moving abroad, Japanese securities accounts will not be available, and even if you deposit them in a bank, the interest rate will be a tear of the sparrows.It’s a little scary to take everything to Malaysia where I’m planning to move.
That’s why we open bank accounts in the U.S. and are busy sending money overseas to spread money to three countries.
I use TransferWise for overseas remittances, but in fact, the remittance fee is higher than that of other companies!
The commission is high in this article, but I would like to deepen the secret of the most exciting transfer wise.
This quote feature is wonderful!
The cheapest way for transfer international
The secret of cheapness lies in the “exchange rate”.
This is the result of simulating an overseas transfer of $7,000.
|Service name||Fee||Exchange rate||Payment amount||Difference|
Due to the elite of overseas remittances, TransferWise has a high commission, but we are able to get the most “receipt amount”.
In order to understand the secrets of the “exchange rate” of TransferWise, it is necessary to first know the mechanism of the existing exchange rate.
Why bank transfers overseas are so high
There are four costs associated with overseas remittances made at banks.
|(1) Remittance fee||Fees to be paid to the remittance bank|
|(2) Received fees||Fees to pay to the receiving bank|
|(3) Relay bank fees||Fees levied by intermediary banks|
|(4) Exchange fees||Fees incurred for currency exchange|
With regard to (1) to (3), it is obvious that the fee increases due to the addition of related companies.
However, since the basic is a fixed cost, it is still good because it is easy to understand how much to pay.
The biggest problem is the exchange fee, which is very difficult to understand how much you paid.
There are three main types of exchange rates used for currency exchange in Japan.
- TTM: Daily base exchange rate determined at 9:55 a.m.
- TTS: TTM + fee: When exchanging Japanese yen to foreign currency
- TTB:TTM-Fee: When currency to Japanese yen
And, “TTS” is the standard when currency is exchanged from Japanese yen to foreign
currency, for example, if you want to send 10,000 dollars to the United States, it is like this.
Amount received: $10,000
TTS: 108 yen
Fee: 3,000 yen
Payment: 1,083,000 yen
So, how much does it cost to send money overseas?
It is not 3,000 yen.
The answer is not known unless you calculate it based on TTM.
If TTM is 107 yen, the fee is 1 yen,
so 10,000 dollars x 1 yen = 10,000 yen will be a foreign exchange fee.
This exchange fee, as a “hidden cost” if you do not dare to describe in the item, the general user tends to go through without noticing.
Why is transferwise cheap?
It all started with a simple saving technique that two of the founders thought of.
※ It is actually an event in Europe, but this time I will replace it with Japan and the United States so that it is easy to image.
One day they happened to get to know each other at a bar, hit it off with complaints about the “hassle” and “fees” of currency exchange, checked the exchange rate (mid-market rate) on the spot, and transferred the currency they did not need each other into each other’s accounts.
After that, they continued to send money to each other every month, and eventually stood up to save those who had the same problems.
Please check the official website for the original founding story.
The reason for the low “exchange rate” of TransferWise is that it is based on the founder’s own trading experience, “We exchange each other’s “unnecessary currencies” and we don’t need fees for each other.”
The fee that the user pays to Transfer Wise is the usage fee of the matching system to find the friend who has the currency that you want, and it is not a foreign exchange fee.
That’s why we have a mid-market rate where users can exchange currency fairly, and we don’t think there is any cost of currency.
Today, I tried to dig deeper about “the secret of the cheapness of transfer wise that overseas remittances are cheap”.
Since the founder’s own “dissatisfaction with the high fee of overseas remittance” has become a form as it is, it is natural to be able to send money at a reasonable amount!
For 40 years, it seems impossible for Japanese banks that do not evolve to change、、、so please take advantage of Transferwise, which continues to evolve with user first!
This quote feature is wonderful!