Worldwide, we fork out over hundreds of Billions in bank fees each year. ($11B just in Australia)
And if you currently use a bank to transfer money – you are paying more than your fair share.
Fortunately there a few good alternatives and the largest of them all in Australia is OFX who also has physical operations in the USA, UK, Canada, Singapore and NZ.
Click here to open OFX in a new window. (Get 2 free transfers)
Why should you read this review of OFX?
My name is Quinn and I have used OFX on a continual basis for over 10 years.
For me that has been OFX but to get the best rates, I have also used many of their competitors in recent years and I have found that there is a lot to consider when choosing a money transfer service.
To save you time and money – my goal is uncover everything you need to make a wise decision.
So what does OFX (hopefully) deliver that banks can’t?
- Control of your Money (timing can make a huge difference)
- Customer Service (like phone support)
- Much Better Exchange Rates (this is where I usually save the most)
- Low Fees (often Zero)
- Security at least as good as a Bank
Before we get into the nitty gritty, (if possible) I recommend you choose a service that has operations in the country where you live.
For instance, OFX has offices in Australia, USA, UK and NZ.
There are three very good reasons for this:
- Your money is safer, because it is regulated by the country you live in.
- Service is generally the highest (like telephone support) when there are offices in the country you live.
- Rates are usually the most competitive because of economies of scale (Basically the more of your country they deal in – the better the rate they can offer)
If there is no service where you are resident then choosing one that operates in the other country you transact between is the next best thing.
Other then that choose a big one – OFX is one of my top picks.
That said, here is my step-by-step review!
Originally owned by Macquarie Bank in Australia but more recently listed on the stock market (ASX) in 2013, OFX has operations worldwide and is fast becoming a big “fintech” success story.
First things first …
Safety and Security
When it comes to sending your money abroad, OFX is just as safe and secure as any bank, maybe safer…
Because OFX has offices worldwide – it is regulated in the Australia, UK, NZ, Canada and the USA – making it one of the most regulated financial companies in the world. (In the case of the US, they actually have to meet the regulations of each state in which they operate.)
OFX also is also obligated to comply with international anti-money laundering laws of these countries.
In short, the chance OFX will lose or mishandle your money is as low as it can get from what I can reasonably tell.
How it Works
Registering with OFX is simple. The setup process is clearly outlined on the website and customer service “dealers” are there to help if you find you need any help.
Here are the two things you have to do:
- Register Online – Click here to register to check out current rates and make two transactions for free
- Verify Your Identity
Registration takes less than five minutes, then you’ll be on to verifying your identity, either automatically or through email.
You may also get a call from someone at OFX. They call themselves “dealers”, but really they are really there to help answer any questions you have.
When I registered, I found they needed me to provide a bit of additional information, like a copy of my ID.
Getting this information back to them was pretty straight forward.
In my case I simply scanned my driver’s licence, but a smartphone photo would be fine as well. Sending them over was simply by replying to the original email I received.
Setting up a Deal
Now the real fun begins. (Yes it is actually fun, especially when you lock in a good rate.)
Once you are registered it is time to set up a transaction. This can be done on the phone as well but I find their online platform to be powerful yet easy.
It is as simple as logging into your account, selecting the currencies and amount and “Get Quote” under the New Quote.
Then you need to fund your account.
There are two main ways of funding your OFX account:
- Direct Debit
BPay is by far the most popular for individuals and smaller businesses.
Direct Debit is used by bigger businesses in most cases. They also accept Poli and EFT.
Exchange rates get more and more favourable as the amount of money you transfer increases.
A nice feature though of OFX recently is that they show the rate you will get. Of course, if may change once you have logged in but in my tests it was pretty close.
It takes about 5 days end-to-end to reach a destination bank account – this was about 2 days quicker then when I used to use a bank.
Receiving money into your OFX account may be a day or two quicker or slower depending on who you bank with and the countries you transact between.
We’ve already established that money transfer companies have better fees and rates, but customer service is where they really shine. OFX lets you make transactions both online and, unlike the banks, over the phone 24/5 (Over the weekend currency markets close).
Making transactions online has an advantage over banks as well. OFX is very transparent – letting you see exactly where your money is during each step of the process.
You can also monitor their rates live so you can make a transfer whenever the rate is best for you.
For me, monitoring the live rate is the biggest perk.
It is this level of visibility and control let me save a great deal of money.
You can check out how I saved $2500 using OFX on a $20,000 transaction here.
You don’t have to commit to watching rates every day – simply ste up some alerts to guide you.
Either way, you’ll always save money over bank exchange rates.
Rates and Fees
Everyone likes saving money.
The Fixed Fee is one of OFX’s greatest benefits.
And the advantage of better exchange rates cannot be expressed enough. The logic here is simple: the more money you transfer, the better the exchange rate you’ll receive.
When I compare the mid-market rate and the rate I was offered by OFX on my online transaction and the difference ranges but most transactions are less than 1%.
The rate also improves for larger amounts. As for the banks, the difference is somewhere between 2% and 4%; this can be a lot when transferring big amounts.
For example, you save minimum of 3% on every transaction that is $600 per $20,000 transaction.
This combined with some simple timing I have found it is easy to save over $1000 for every $20,000 moved.
The Bottom Line
When I deal with OFX I benefit from excellent exchange rates, great customer service and speedy transaction times.
Once when a transaction got delayed (my fault) they actually gave me an even better exchange rate as compensation.
OFX continues to meet my expectations and has even gotten better over the years.
And thanks to other OFX reviews, I know I’m not the only one.
What about the bad reviews?
Seeking out the one star reviews makes me think they have pretty tight standards when it comes to who they can deal with. If you run a business for example, they may want proof of the type of business you are involved in to ensure it is legal. These tight rules are most likely due to all the regulations they have to satisfy. Certainly I had no worries and by far the majority did not either.
If you have a business or unusual circumstances, my advice here is to understand what they need so you can get approved quickly.
For most people it will be smooth sailing.
All in all, I am impressed with the OFX service (Get 2 free transfers when you click here and sign up) and will continue to enjoy saving load of money over a bank.
Thanks for reading!