Euros paid into a Barclays Sterling Account

wizardofloz

Hi,
I have a Barclays sterling business current account. I have been working for 6 months and being paid my invoices in Euros into this account. The charges are paid by the sender so Barclays just credit the account on the 3rd day at the days exchange rate plus they add a bit more. eg. instead of 1 = 1.15 they may convert at 1 = 1.19 etc. They have been making about £100 per month off me. Is this normal ? and are they right to do this when charges have already been paid and it's money being credited just like a normal sterling account but Euros.
thanks.

System

Yes, Barclays can convert incoming euro to GBP at whatever rate they find sufficiently profitable, though they are supposed to tell you what rate they have used.
Incidentally, if a sender uses a SEPA Credit Transfer to send you your euros from (for example) Hamburg (as any well-informed sender will), then his bank can only charge him the same as they charge to send euros from Hamburg to Berlin, that is, usually, nothing.
Since you appear to receive a lot of euro, you might consider opening Citibank euro and GBP accounts. You can then transfer between these Citi accounts on dates that suit you, at a reasonable (though of course still with a buy/sell spread) exchange rate that Citi make explicit before you make the transfer. And you get a debit card that you can use to withdraw euro free of charge from Visa ATMs in the eurozone.

benjus

Definitely worth getting a Euro account if this is likely to continue. Then you can use a specialist FX broker to transfer between the Sterling and Euro accounts if you prefer.

Chorlie

1, Open a Euro A/c, you can do this with Barclays.

2, The new rules state, that a receiving bank can't charge you more to accept an International Euro Payment (within the Euro Zone) than a UK Payment (ie a sterling payment from say Natwest in Manchester).

3, If the remitter is selecting to pay all charges than Barclays should just convert the Euros to Sterling at the days Spot Rate (if under £25k). Spot Rate is Barclays Exchange Rate for that day, this rate can be different from Bank to Bank or what's published on none Barclays web sites. Barclays set there own exchange rate, just as Natwest, Citibank etc set theirs.

Ask Barclays to explain (in writing) why they are charging you over the Spot Rate, if the remitter has selected split charges then you will pick-up the exchange rate and any processing cost (which as point 2, should be the same a say a Chaps Payment).

Are you looking at say the Newpaper for the exchange rate and expecting that rate, or are Barclays telling you there exchange rate and than adding an extra charge?

wizardofloz

thank-you for all your responses. this is the last month that i will be working in Euros to Sterling but i thought if they are charging more..ie charging over the exchange rate i get from google.com on the day, then i could try and recoup some of the extra money since February 2010. but then as mentioned, barclays can set their own rate, slightly above the universal base rate.

Chorlie

wizardofloz wrote: »

thank-you for all your responses. this is the last month that i will be working in Euros to Sterling but i thought if they are charging more..ie charging over the exchange rate i get from google.com on the day, then i could try and recoup some of the extra money since February 2010. but then as mentioned, barclays can set their own rate, slightly above the universal base rate.

Sound like you're looking at the wrong exchange rate, if you google an exchange rate you'll get a rough guide of what the exchange rate is. To find out what rate you'll get you'll have to get Barclays exchange rate for the day of transaction, if it's under £25k they will use what they call the daily Spot Rate, if its over £25k they will book an exchange rate direct with there own exchange rate dealers so it will be different to there daily exchange rate (spot rate) and they wouldn't be able to tell you what it'll be until it's been booked.

If you look to the right of this page it shows Todays Top Currency Rate and it lists the Best & Worst, this show how much difference there can be from one company to another.

borderfox_2

Hi. I just picked up on this thread following a forum search. The example given deals with an inbound 'SEPA Credit Transfer' of euros from Germany to the UK. Can this work the other way round?

ie. are UK high street banks obliged to accept a 'SEPA Credit Transfer' from a Sterling UK account to a Sterling Account in another Eurozone Country?? ie. charged at the equivalent of domestic bank transfer rates??

Hitting a brick wall with the banks on this right now - but I think they are failing in their obligations. I just want to prove it beyond doubt.

System

borderfox wrote: »

Are UK high street banks obliged to accept a 'SEPA Credit Transfer' from a Sterling UK account to a Sterling Account in another Eurozone Country?? ie. charged at the equivalent of domestic bank transfer rates??

Alas, no, because Brown-Blair, in their eagerness not to offend UK banks, chose not to apply EC regulation 924/2009 to transactions in GBP. Unlike the Swedish government, which chose to apply it to transactions in kronor.

borderfox_2

YoungNick wrote: »

Alas, no, because Brown-Blair, in their eagerness not to offend UK banks, chose not to apply EC regulation 924/2009 to transactions in GBP. Unlike the Swedish government, which chose to apply it to transactions in kronor.

That is pretty infuriating - when you consider they charge £20-£25 regardless of how small the transaction value is!!

How much trouble would it be for someone with a current account to setup a euro account alongside it?

borderfox_2

Just after finding this (looks like i cant post the link) - which seems to suggest that SEPA applies to sterling to sterling SEPA credit transfers also??

"All domestic and cross-border payments (euro and Member State currency, e.g., sterling) that are made to and from countries in the European Union will be governed by the PSD."
"The Payment Service Directive (PSD) is new EU legislation which not only provides the legal platform for SEPA but also introduces new rules and standards for all payment service providers."

Does that sound right?

System

borderfox wrote: »

How much trouble would it be for someone with a current account to setup a euro account alongside it?

If you have a GBP current account with one of the big banks, and if it offers a euro account, it should be simple to open this euro account. But first check carefully what the charges are, and what the euro account actually allows you to do. Also, threads in this forum have reported muppets in bank branches giving wrong information about opening and using euro accounts.
The least-bad euro account I've heard of in this forum is Citibank's. In practice, you need to have a GBP account with them as well. You then get a debit card that you can link, at any one time, to either your euro account or your GBP account. Switching, once you've got through the call centre menu, is instantaneous.