Banking question - Paying for flights using £ or Canadian $?

socks_uk

My husband is Canadian and the last time we visited Canada was in 2012 and his mum (longing to see him) has deposited $3000 (Canadian dollars) into my husband and my joint Canadian bank account for flights to Canada.

Is there anyone that can advise us as to whether we should either withdraw the money in £s at the ATM (we acknowledge there will be a withdrawal charge of about £5 for each withdrawal) or should we try and pay Air Canada in Canadian dollars with our client card?

We would use our Tesco credit card to pay for the flights if we were to withdraw at the ATM which would give us Section 75 protection but we also know that Martin Lewis also says that paying in local currency is better exchange rate but we wouldn't have the Section 75 protection.

We also don't want to try to pay with our cards or even to do multiple consecutive day withdrawals and risk the account being frozen.

Sorry if I posted in the wrong forum,  I wasn't sure if it was a travel question or a banking question.

eskbanker

Withdrawing cash seems unnecessary - assuming you have access to a UK current account, why not pay with your credit card and use a currency broker to transfer the money from the Canadian account to the UK one to pay off the card balance?

https://www.moneysavingexpert.com/banking/foreign-currency-exchange/

eDicky

If you're in the UK, buying flights online that originate in UK (I'm assuming), you'll be shown prices in GBP. On entering your Canadian bank card details you may be given the option to pay in CAD, but at their disadvantageous exchange rate, whereas if you opt to pay in GBP the bank will no doubt levy fees. Therefore, using your Tesco card to buy the flights is probably best in that situation.

I'm not sure what reason you would have for withdrawing C$3k in pounds from an ATM, with associated costs. You could always use a transfer service to convert and send the dollars to a UK account.

socks_uk

Thank you both of you for your replies.  I'm the one who does the finances in our relationship but I'm not very knowledgeable on the best (or correct) way to do this. 

We do have online access to our Canadian bank account and I can look into moving it internationally, although it sounds a bit scary.  I'm the type of person who, when adding a new payee to my Nationwide account, I send £1 first and check they have received it before I send the rest of the money.  To be fair, that's usually to my own accounts or family & friends' accounts.  Maybe it's not as hard as I imagine.

eskbanker

socks_uk said:

I'm the type of person who, when adding a new payee to my Nationwide account, I send £1 first and check they have received it before I send the rest of the money.  To be fair, that's usually to my own accounts or family & friends' accounts.

That was the best way of validating new payees for many years, so you're far from alone, but now that Confirmation of Payee has been implemented (for most permutations of significant players), it's largely redundant.

In terms of the wider issue, if you already have UK and Canadian accounts, are you keeping these entirely unconnected, with no transfers between them?  If so, do you perhaps have the option of leaving the gifted money in the Canadian one, for use when you're over there?

socks_uk

eskbanker said

In terms of the wider issue, if you already have UK and Canadian accounts, are you keeping these entirely unconnected, with no transfers between them?  If so, do you perhaps have the option of leaving the gifted money in the Canadian one, for use when you're over there?

Unfortunately, we don't have enough money in our UK bank accounts for the flights, hence the gift from my mother-in-law of the cash she put in our joint Canadian account.  There will be about $1,500 still in the account but we won't need that much while we are there as, like the previous visits to the in-laws,  we'll be staying with them and most meals will be at home.  I guess it'll be supermarket shopping for groceries.

Brie

You could see if you can buy the tickets paying in CAD rather than GBP.

As for transferring all or some of it to Nationwide.....I've been trying to set up transfers using WISE which lots of people recommend for foreign exchange transfers.  The WISE account is fine, I've confirmed that my Virgin/RBS account won't charge for the money coming in to my account as it will be in GBP.  But I can't get things set up on the Canadian end as my bank (TD) want me to go to the branch to organise it as WISE isn't on any of their payee lists and there's no option for me to add it.  Bit difficult as that's in Ontario and I'm in the UK.  

socks_uk

I'm looking at the International Money Transfer section on Royal Bank of Canada's website and it is asking for my UK bank account's (Nationwide) SWIFT code or BIC.
At least I have somewhere to start.

Brie

Check what they charge you to exchange the money and double check that it's being sent as GBP to save fees at Nationwide.

SiliconChip

socks_uk said:

I'm looking at the International Money Transfer section on Royal Bank of Canada's website and it is asking for my UK bank account's (Nationwide) SWIFT code or BIC.
At least I have somewhere to start.

This is almost certainly going to be more expensive than using one of the money transfer services previously referred to. I've used WISE to transfer money from the UK to New Zealand and while it was a little daunting at first (the process isn't entirely clear until you start doing it) it was pretty straightforward and I'd have no hesitation doing it this way in future.

PRAISETHESUN

+1 for Wise, I've used them in the past without issue. Not the absolute best for exchange rates, but they are transparent about their fees and the rates are pretty good. Fineco is another one that comes up fairly often in discussion and gets good reviews. The absolute last thing you want to do is let your bank do the currency conversion for you - you will lose out by a substantial margin due to international transaction fees or poor exchange rates (or as if often the case, both).