Foreign Currency Direct charged me £100 help

bucski

Hi,
Recently transferred £2000 to France via Foreign Currency Direct as it was cheaper (or so I thought) this way.
Set up a bank transfer, as they suggested and said that it should take 3 days. However it took 4, through no fault of my own.
FCD then charged me £100 (£25 a day) as a "fine" for late payment.
They did not make me aware of this over the phone but since arguing with them they just said "read our terms and condtions"
This states that overdue payment shall be made at BofE base rate (5.5%) plus 3%, levied daily. Does that not mean 8.5% /365 (since BofE base rate is an annual rate) X £2000, which works out at 50p odd a day?
They have said they won't give me back my £100 pounds, what do I do?
Thanks
Tim

jonesMUFCforever

You should have gone to Specsavers - sorry your bank!

JudyM_3

When you book a foreign currency (FX) trade, the company books the money with their bank on your behalf at an exchange rate agreed with you in your contract. You then have to send in the money to buy that currency as agreed. If you don't pay for it, you are in breach, and the company have to sell out of the deal. They have costs to meet.

All companies have this. But they SHOULD make you aware of their terms and conditions when you sign up with them. The one we use (www.firstratefx.com) made us aware straight away of our obligations to pay for the currency we had booked, otherwise we could be in breach. They were very nice about it, but stressed the importance of the agreement. Seems fair to me, otherwise they are stuck with currency they have bought and no one to pay for it. Imagine if everyone did that?!
When you say yor payment was late through 'no fault of your own', then I think FC Direct are being very harsh in their treatment of you. Don't use them again - Try the company we are with!!
Can you try and reclaim the amount from whoever sent the money in late to FC Direct? Your bank perhaps?

bucski

Thanks for your reply judy, very helpful, will try the bank

pheasant_plucker_3

Having used a few FX companies it seems that they all have penalties and charges in their small print which is not really that surprising as JudyM says. Being charged £100 does sound excessive given the relatively small transaction size, and it might be worth using the same argument that has been used by many people in reclaiming bank charges in that charges should be a reflection of the cost incurred and not a penalty and seeing if they back down.