\

Why you shouldn’t accept a “Wire Transfer” as payment method for international clients

Wire Transfer

There are a bunch of different methods of payment you can offer your clients, here’s why you shouldn’t use “Wire Transfer” as one of them when dealing with international clients.

Quite a few months back I shot a feature on Parkway Drive for Alt Press Magazine.

The particular issue is now out of print, so check it over here if you missed it.

The shoot, supply and print all went without hitch, the crew at Alt Press were super cool to work with, and Parkway Drive are a damn fine bunch of lads making big waves for Aussie hardcore overseas so good on ‘em!

My invoice to Alt Press had been sent and was in the pipeline to be paid.

No dramas there.

I received the notification that “XXX.XX” amount had been paid via wire transfer.

Wire transfer?

That wasn’t a payment term I had listed on my invoice?

Now, without putting a dollar figure on exactly how much I was paid by Alt Press, safe to say I would suggest it was a “decent” amount for the shoot in question, I do want to alert you to just how much the banks skimmed off the surface.

When I noticed the money in my account was a fair amount less than I had been quoted, my first thoughts were that an incorrect exchange rate had been used, so I fired off this email to Alt Press:

Hi Katherine,

The transfer has come through, however the amount is short somewhat.

On the date of transfer (2nd May 2011) the exchange rate was 0.9115898176 USD to the AUD (check it here at XE Currency Convertor)

The amount received in my account was $XXX.XX

Using the global exchange rate on that day the total amount should have been $XXX.XX

Could you please amend the difference?

cheers,

Benon

Katherine’s reply:

Hi Benon. You may wish to check with your bank. I just looked at our wire paperwork and exactly $XXXUSD was sent to you. It’s probably a fee that your bank charged you to receive the wire. Thanks.-Katherine

Fair enough.

So I enquired at my bank (the good people of BankWest):

to:
BankWest

subject
My Account

Hi folks,

I recently received a wire transfer from the USA of $XXXUSD

On the date of transfer (2nd May 2011) the exchange rate was 0.9115898176 USD to the AUD (using XE Currency Convertor).

The amount received in my account was $XXX.XX

Using the global exchange rate on that day the total amount should have been $XXX.XX

Could you please explain and amend the difference?

cheers,

Benon Koebsch

and this as their reply:

from:
BankWest IBS

subject
Re: My Account (KMM2155845V89126L0KM)

Dear Benon

Thank you for your email.

I can confirm the following information regarding the telegraphic
transfer you received on the 2nd May 2011.

It has first processed from Standard Chartered at $XXX.XX USD. They
have deducted a $15.00 USD processing fee.
The telegraphic transfer we received was then sent via National
Australia Bank (NAB) converted at the rate 1.1173 (NAB rate of USD to
AUD on 2nd May 2011).
NAB received $XXX.XX AUD after the conversion. Then NAB have deducted a
processing fee of $18.00.
This leaves $XXX.XX when it reached Bankwest to credit to your account.

If we can assist you with any other query please do not hesitate to
contact us via BankMail, or on 13 17 18 between 8am – 8pm your local
time or +61 8 9449 2840 from overseas.

Regards

Kelly
Email Team
Bankwest

AFR Smart Investor Blue Ribbon Awards
2010 Bank of the Year

It’s interesting to note that BankWest then also took a further $10 off the top as something they call an “inward payment order fee” .

My reply to BankWest:

to:
BankWest IBS

subject
Re: My Account (KMM2155845V89126L0KM)

Thanks for the reply Kelly.

Can I ask why the NAB was involved?

You understand my frustrations, I have lost $72 ($82 when you add the $10 fee you kind people skim off the top).

And the reply from BankWest:

from:
BankWest IBS

subject
Re: My Account (KMM2156464V15959L0KM)

Dear Benon

Thank you for your reply message.

When transferring funds internationally by way of Telegraphic Transfer,
it is necessary that Banks utilise the services of ‘correspondent’ Banks
to assist in the transfer. As Banks do not hold offices in every
country, it is necessary to establish reciprocal agreements with a
representative Bank that may assist in getting the funds transferred
successfully to their destination.

If a correspondent Bank is needed for assistance in the transfer, they
are entitled to charge a fee for their services. Upon arrival at the
recipient Bank, this Bank may also raise a fee for processing the
transfer to the recipient account.

We understand that you feel disappointed with the fee you have incurred
from NAB, and we trust that the above will assist your understanding of
how the fees were raised.

If we can assist you with any other query please do not hesitate to
contact us via BankMail, or on 13 17 18 between 8am – 8pm your local
time or +61 8 9449 2840 from overseas.

Regards

Christina
Email Team
Bankwest

AFR Smart Investor Blue Ribbon Awards
2010 Bank of the Year

So essentially to send money from the USA to Australia via “wire transfer” it’s gonna cost you around $80 (and that’s when the exchange rates were almost 1:1, imagine a year ago!)

My advice?

If working for a publication outside of Australia, PayPal as payment method should be stipulated on your invoice as the only accepted payment method!

  • http://daniel.zuccon.com Daniel

    Just got stung with the same fee from BankWest mate. Thanks for the email correspondence that now explains it!

    • BJWOK

      Bummer Daniel! Sorry you couldn’t have seen this post earlier :(

      Paypal all the way from now on!