Is there a bank that does not charge to receive money from abroad?

jennifernil

My husband receives a small state pension from Norway as he worked/contributed there for about 12 years. He started receiving it in August 2009, it is paid monthly in STERLING and Norway deducts the equivalent of about £2.50 for paying it to our bank every month.

In December 2010 the entry on our bank statement changed from "Chaps" to "Intl Tx". We bank with Halifax. In January 2011 we received a letter from Halifax telling us that an amount in GBP had been received and that they had deducted a "Commission" of £3 before crediting it to our account.

I immediately rang them to find out what was going on and was told that it was an "internal problem". The payments were now being routed through Lloyds and Lloyds were charging Halifax so Halifax were charging us. It was apparently affecting quite a few customers, and they were trying to resolve it with Lloyds.

I enquired whether, as no letter was received in December, we had also been charged then, and was told that they would check that and if so they would refund us £6 rather than £3. I was also told that if we were charged again, I should ring them again.

A £6 refund was received a few days later, closely followed by a letter in mid February notifying us of another £3 deduction. We decided to wait to see what happened in the next couple of months, rather than ringing over £3 every month.

We heard nothing more till today, when a similar letter arrived re the June payment, but suddenly the "Commission" is now £7.

I have rung them, but this time the attitude was basically "tough". They claim they wrote to us way back saying we would now be charged (no letter came here), and that the charge has now gone up. (that's a 133% increase!) We have no idea if anything was deducted in March/April/May as the GBP amount varies with the exchange rate.

The rather abrupt lady I spoke to was also of the opinion that we should have been charged from the word go, and that what I was told in January regarding it being down to Lloyds charging them was rubbish.

I will be taking it further with them, but am not holding out much hope, so wondering if we can open an account elsewhere to receive this money without losing an extra £7 per month.

Is there a bank that will not charge us to receive a STERLING payment from abroad?

System

If possible, it would help if your husband can find out from the Norwegian pension organisation exactly how they pay. As far as I know, it is likely to be by the legacy 'SWIFT' system. This operates by banks 'wiring' each other instructions, and is inherently expensive.
Nationwide does not (currently) charge for receiving SWIFT payments, but it may be difficult to get the Norwegians to understand the rigmarole Nationwide (currently) uses to specify that incoming payments must be routed via HSBC.
http://www.nationwide.co.uk/search/DisplayArticle.aspx?article=1572
Alternatively, given that your husband has a Norwegian social security number, can he (re?)-open an account in Norway, and ask to be paid in NOK (presumably without any deductions)? He could then either use the money on visits to Norway (if any), or make occasional transfers, either by SWIFT transfer direct to a UK bank account, or by using one of the brokers such as xe.com.

bengalknights

Barclays and HSBC i know dont charge for receiving money from abroad, they do give a poor exchange rate though.

jennifernil

Thanks both. As we understand it, the Norwegians are actually sending the amount in Sterling, and are charging us for that (the £2.50 each time), so exchange rates should not come into it, but I will get OH to contact them to see what they have to say.

He has a post office account in Norway, so could be paid into that, but no idea if this would be a free transfer, banks in Norway are much more expensive on charges than here! But worth looking into.

We do not go to Norway much, only about once every 3 or 4 years, it is far too expensive for us to go more often, so we really do not need to keep much cash there.

Also, he does of course still have to declare, and pay tax on, this money here. So not having the money here, but still having to pay the tax, would mean he would be paying the tax on the money out of what he gets here.....not a good situation.

I will look into the accounts suggested.

jennifernil

YoungNick wrote: »

If possible, it would help if your husband can find out from the Norwegian pension organisation exactly how they pay. As far as I know, it is likely to be by the legacy 'SWIFT' system. This operates by banks 'wiring' each other instructions, and is inherently expensive.
Nationwide does not (currently) charge for receiving SWIFT payments, but it may be difficult to get the Norwegians to understand the rigmarole Nationwide (currently) uses to specify that incoming payments must be routed via HSBC.
http://www.nationwide.co.uk/search/DisplayArticle.aspx?article=1572
Alternatively, given that your husband has a Norwegian social security number, can he (re?)-open an account in Norway, and ask to be paid in NOK (presumably without any deductions)? He could then either use the money on visits to Norway (if any), or make occasional transfers, either by SWIFT transfer direct to a UK bank account, or by using one of the brokers such as xe.com.

Thank you, we will look into this, we already have Nationwide FlexAccounts, so this could be easy to set up. I will get him to contact Norway.

System

jennifernil wrote: »

He has a post office account in Norway, so could be paid into that, but no idea if this would be a free transfer, banks in Norway are much more expensive on charges than here!

Also, he does of course still have to declare, and pay tax on, this money here.

It would be surprising if there are any charges to your husband for a transfer of a Norwegian pension in (I assume) its original NOK to an account in Norway, either with posten or with a bank. However, I wouldn't know how easy or costly it then would be for your husband to make transfers to the UK. I was thinking that your husband could do a transfer say every six months, since charges are per transfer. If he transfers in NOK, the receiving bank in the UK will convert to GBP, of course, and take a mark-up. It may be that the Norwegian pension authority gets a significantly better rate to buy lots of GBP to pay lots of pensioners resident in the UK.

As I expect you know, as a UK resident he only has to pay UK tax on 90% of a foreign pension.

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/LeavingOrComingIntoTheUK/DG_10027480

hermante

bengalknights wrote: »

Barclays and HSBC i know dont charge for receiving money from abroad, they do give a poor exchange rate though.

I think you should always be able to send money for free inside the EU, but from other places:

HSBC is free for smaller amounts but charges £6 for anything over £10K, which is not bad, depending on what the sender's bank fees are.

Someone at Santander told me that there are no charges but I don't know whether to believe them. However, my friend deposited a large GBP cheque drawn on a foreign account into Santander and was not charged for this, surprisingly (or maybe he didn't realise he got charged, in my experience the charges come up a month or two later).

muh3

I think your best option is opening a bank account in Norwey, have the pension paid in this account and then use a money broker, that should save you a lot of money over the time and you can decide when you get the money send (watching the exchange rates).

Evilm

When sending (or receiving) international payments for business There is a box on the form for who pays the fees. You can either tick 'both' 'sender' or 'recipient'.

It sounds like he needs to talk to the company who are sending the payments and ask them to ensure that they tick 'sender'. What happens then is the receiving bank should pass their charges back to the sending bank and the original sender.

EDIT: It may be that they can't do this on the pension system but its worth asking.

Azrael_1701

http://www.halifax.co.uk/internationalpayments/Halifax%20IPS%20301009v2.pdf

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jennifernil

YoungNick wrote: »

It would be surprising if there are any charges to your husband for a transfer of a Norwegian pension in (I assume) its original NOK to an account in Norway, either with posten or with a bank. However, I wouldn't know how easy or costly it then would be for your husband to make transfers to the UK. I was thinking that your husband could do a transfer say every six months, since charges are per transfer. If he transfers in NOK, the receiving bank in the UK will convert to GBP, of course, and take a mark-up. It may be that the Norwegian pension authority gets a significantly better rate to buy lots of GBP to pay lots of pensioners resident in the UK.

As I expect you know, as a UK resident he only has to pay UK tax on 90% of a foreign pension.

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/LeavingOrComingIntoTheUK/DG_10027480

Thanks. Yes, we do know about the 90% bit, I have done one Tax Return with his pension on it already, so we read up on the rules last year.

I will get him to check whether there would be a charge by the bank in Norway to get his pension paid in, his sister is getting a pension so she should know.

xe.com seem to charge £15 for a transfer, so that would be cheaper if he did it say twice a year, but the exchange rate is the unknown factor as you say.