Large foreign currency withdrawal?

Mrdini

Hello all,

Not sure if this is the right forum to post in, but anyway here goes...

My partner is probably going back to China for Chinese New Year. No problems so far.

However, since she originally came here to study a few years back, she had to borrow a fairly substantial amount of money - in the five figures range. As a result, she wants to use this opportunity to pay back some of the money if possible, as some of her creditors need the money back.

The problem is that, right now, we just found out that GBP£ is basically tanking against RMB, (link), which is a bit of a problem for her, this time round, and possibly in the future.

So, her questions are basically

• Is there anything she can do to reduce the impact of the poor exchange rates?
• How should she convert/withdraw the money in an effective way once she's in China? Use her british current account card in a Chinese bank?
• Is there anything she should ideally do in the future for the remainder of the debt she owes?

I suggested perhaps a currency broker could help, given it's a large sum of money, but I'm not sure - can they?

Many thanks for any assistance!

Voyager2002

She should certainly open a Nationwide flex account, and use the card for cash withdrawals when in China. However, the daily limit may be inadequate.

There is a complicated way to move money into a bank account in China IN HER NAME by means of Fidelity Money Funds: free of all charges and at the best possible exchange rate, but be prepared to do some work to set it up. Alternatively, a simple and low cost service is offered by people like Xe.com.

There is nothing I can do about the exchange rate, except urge you to read commentators about what will happen to the pound against the US dollar. For some years the RMB has been linked to the dollar: US politicians have been urging the Chinese policy-makers to allow the yuan to rise against the dollar, but up to now they have refused, and my guess is that this will continue for a while. Therefore, if you think that the pound will rise against the dollar then it will do so against the RMB as well.

alanrowell

Mrdini wrote: »

The problem is that, right now, we just found out that GBP£ is basically tanking against RMB, (link), which is a bit of a problem for her, this time round, and possibly in the future.

That link is all about the GBP against the Euro - is has little to do with the RMB / GBP exchange rate which is directly affected by the USD / GBP exchange. Whilst the GBP is down against the USD compared to a year ago, it is still substantially higher than it was a couple of years ago

So your statement that the GBP is basically tanking against the RMB is wrong and as I recommended in the other thread sticking the money in a high interest account will probably do your friend better than changing the money now

Mrdini

Voyager2002 wrote: »

She should certainly open a Nationwide flex account, and use the card for cash withdrawals when in China. However, the daily limit may be inadequate.

Cash withdrawals aren't an issue in this situation. It's the repayment of the large debt that's the issue...

There is a complicated way to move money into a bank account in China IN HER NAME by means of Fidelity Money Funds: free of all charges and at the best possible exchange rate, but be prepared to do some work to set it up.

Mind giving me a link? I assume you aren't referring to investment funds, are you...?

Alternatively, a simple and low cost service is offered by people like Xe.com.

That'd be perfect, apart from the fact they don't seem to handle RMB online - only over the phone. But aside from that bit, that does seem quite ideal... By the way, is there any other companies that offer a similar service (for comparision)

Mrdini

alanrowell wrote: »

So your statement that the GBP is basically tanking against the RMB is wrong and as I recommended in the other thread sticking the money in a high interest account will probably do your friend better than changing the money now

The problem is that she needs to pay a portion of the sum ASAP - preferably when she goes back to China, and preferably with as little cost incurred. The currency trading that xe.com offers does seems good, so will look at that.

As for saving up money - she already is - the bulk of the money is currently in a couple of NS&I ISAs, which she'll withdraw shortly before doing the currency transfer.

Voyager2002

Mrdini wrote: »

Cash withdrawals aren't an issue in this situation. It's the repayment of the large debt that's the issue...
Mind giving me a link? I assume you aren't referring to investment funds, are you...?

Since she will be there, she could withdraw the equivalent of a hundred pounds a day, and at the end of ten days make a thousand pound repayment. That might or might not be enough for her situation.

Fidlelity: yes, it is designed as an investment product for people who want to be able to switch their funds between currencies. It therefore offers fee-free currency exchange at commercial rates. You withdraw your investment by giving them details of a bank account in your name, anywhere in the world, and by asking them to send the money to that account by electronic or telegraphic transfer. There is no fee for withdrawals either. However, setting this up is a LOT of hassle, and the product details are written in gobbledegook.