I’ll explain how to transfer money from Portugal to the UK in 4 easy steps, how long it takes, the options you have, and the way to avoid paying high charges.
You basically have two options:
- use a bank
- use a currency broker
A lot of people might be tempted to use their bank.
It’s more familiar, and your money is probably already sat in your account.
But the biggest drawback of using a bank is the high cost.
The cost of using a bank can be 4%-5% for international money transfers.
That can make quite a difference if you’re transferring €10,000, but especially for larger amounts, the difference can be substantial.
If you’ve sold your property in Portugal for €120,000, a 5% cost works out at €6,000.
That’s a tonne of money to give away to a bank.
If you want to avoid the high charges of banks, the best way to transfer money from Portugal to the UK is to use a specialist currency broker.
Transferring money from Portugal to the UK (in 4 easy steps)
If you use a bank or currency broker, the process of sending your money from Portugal to the UK is largely the same.
Step 1 – Customer ID check
All new clients need to register, which is basically an ID check. This is required due to global anti-money laundering rules.
Most people can be identified easily – so it doesn’t take long to be up and running – often on the same working day.
Step 2 – Lock-in a Euro to Pounds exchange rate
Exchange rates vary considerably between banks and brokers.
For larger transfers, the exchange rate is the main cost.
Once you receive a quote, it’s up to you whether to go ahead. Nothing will happen without your permission.
After your rate is agreed, you will automatically be emailed a trade confirmation, which will have all the details of the trade within it.
Step 3 – Send in your Euros
You need to pay for your transfer before your money is converted.
The trade confirmation will show the bank details of where you need to send your Euros.
Banks will require your Euros upfront. Currency brokers can secure a rate for you before you send in your money.
This can be an advantage if rates are favourable and you don’t want to miss an opportunity waiting for your funds to clear.
Step 4 – Your Euros are converted to Pounds and sent out
You don’t need to do anything at this stage.
Your bank or currency broker will convert your Euros into Pounds at the rate agreed and send the Pounds to the UK bank account you’ve requested.
How long does it take?
Typically, your money should arrive into your UK bank account in 1-3 working days after you have sent in your Euros.
From my own experience, I’ve found the banks are slower at processing international money transfers.
If you use a bank, you should probably add on an extra 1-2 working days to be safe.
I suspect the reaosn banks are less efficient is because they process payments in batches and it takes time for them to gather all the information from their branches.
A currency broker has faster turnaround times as they are focused on money transfers.
What are the costs?
When you are transferring money from Portugal to the UK, there are two common charges to look out for: exchange rates and transfer fees.
The total cost is the combination of the two charges.
To make it easy, it's better just to find out the amount of Pounds you will receive for your Euros.
1. Exchange rates
Each currency broker or bank will offer you a different exchange rate based on the amount you are looking to send.
There is no such thing as standard or official exchange rates.
These days there are quite a few websites, such as XE and Oanda, that provide free exchange rates. But there’s a catch…
Hidden in disclaimers are words such as "for information purposes only" or "not available to consumers".
Basically, they are showing "interbank" rates. As the name suggests, they are wholesale rates used between banks. Not even massive corporations get the interbank rate.
To put it bluntly, most of the rates you see online are not real rates for customers. To get a real rate, request a quote.
When you get an exchange rate quote from a currency broker or bank, it will include a mark-up (or ‘spread’) on top of the wholesale rate.
We looked into the exchange rates offered by the largest Portuguese banks - Caixa Geral de Depósitos. Banco Santander Totta, Banco Comercial Portugues and Banco Internacional do Funchal.
In broad terms, you should expect the rates offered by the big banks to have a 4%-5% margin – depending on the size of your transfer.
The rates offered by currency brokers are far more competitive.
A currency broker has far lower overheads than the big banks and can pass those savings onto customers.
2. Transfer fees
A transfer fee is normally a flat amount that is charged per transfer.
It is in addition to the money made from the exchange rate.
Some of the big Portuguese banks and even some currency brokers will charge you a transfer fee every time you send money abroad.
I’ve even seen situations where banks have charged customers two transfer fees – one for the sending bank in Portugal and one for the receiving bank in the UK.
The transfer fees are normally in the region of €20 to €30 per transfer.
However, if you choose the right currency broker, you can avoid paying transfer fees altogether. Hint: we don’t charge you any transfer fees.
5 reasons why you really shouldn't use your bank...
- It's not their area of expertise
- Their exchange rates are uncompetitive
- Some banks charge transfer fees
- They won't help you with timing
- You are not their priority
Is it safe to use a currency broker?
I can understand why some people might be nervous using a currency broker.
I have been on the customer’s side of the fence too.
Saving money is one thing, but you want to know your money is safe and secure.
The one check I suggest you do is to make sure that the company you use is Authorised by the Financial Conduct Authority (FCA).
The reason Authorisation is critical is it means your money will be held in a safeguarded client account, held separately from any company funds.
In basic terms, your money will be set aside to carry out your transfer and not used for any business purposes.
It’s not worth risking your money with a company that is NOT Authorised by the FCA.
If a company hasn’t bothered to get Authorised, it’s not a good sign.
To check if a currency broker is Authorised, simply type in the company name and hit search on the FCA register.
Are all currency brokers the same?
It can seem like there's a lot of companies that carry out money transfers.
But if you scratch the surface, there are some fundamental differences.
As I mentioned before, some currency brokers are Authorised by the FCA, while others are not.
There are also a lot of companies that are focused on micro-payments to family and friends, such as Western Union, Ria, World Remit, Azimo, Remitly.
Another category is the “online-only” operators.
Online-only operators might look and sound like a currency broker, but they are really just a web-based platform or 'app'.
These companies tend to call themselves money transfer specialists rather than currency brokers.
I guess it’s because there are no humans (brokers) to assist you.
Paypal, Transferwise, Revolut and CurrencyFair are some of the more popular online-only platforms.
They might appeal to some people, but not others.
I can understand if you are making lots of small, regular payments, then you might become comfortable doing everything yourself online.
However, from my experience, people who are making larger money transfers want the peace of mind of being able to speak to someone.
If you are sending a large amount of money, you will probably want some human contact. I know I would.
A currency broker may be the right option for you.
Their rates are just as competitive, and you will get a much better service.
Once you request a quote, you are assigned a personal account manager.
A personal account manager can:
- Answer any questions you may have
- Offer market guidance and rate alerts in the lead up to your transfer
- Help set-up and check the details of your transfer
- Keep you informed from start to finish
One common area for mistakes in international money transfers is with the “beneficiary details”, which is where you want your money sent.
International payment codes are generally a long number – so mistakes can be made if you’re not used to money transfers.
We do a double-check for you to prevent problems.
Plenty of places leave you to do everything yourself. You don’t want to be cursing yourself as you hope or pray your funds can be recalled from the wrong bank account.
How to get the best exchange rate
A currency broker can work with you to achieve the best exchange rate possible.
Exchange rates, such as Euro to Pounds, move every 2-3 seconds.
Daily news and events cause fluctuations in the exchange rate, so there will be better times to exchange your money than others.
If you are selling a property in Portugal, you might have a window of opportunity of a few days, weeks or even months to get the best exchange rate possible.
You may also have a specific rate in mind or an amount in Pounds you are aiming to receive.
A currency broker can monitor exchange rates for you and let you know when the rate moves in your favour, or if it reaches a certain level.
For larger money transfers, even small, fractional moves in the exchange rate could have a big impact on the Pounds you will receive.
On a €100,000 transfer, a 1% improvement in the rate is €1,000 extra in your pocket.
Please note that banks and online-only operators will not offer you any assistance on rates.
If you are sending money from Portugal to the UK, you have a choice to use a bank or currency broker.
A bank could charge you 4%-5% of the money you transfer.
On a transfer of say €50,000, it could cost you €2,500 in fees and charges.
Key Currency is a leading currency broker.
We are very experienced at sending money from Portugal to the UK, particularly on property transactions where costs and timing can make a big difference.
Not only are we familiar with the Portuguese banking system, but we also have people on the ground in Portugal and account managers in the UK that speak both English and Portuguese (this can help when dealing with lawyers and banks).
As a company, we are open and transparent.
All the names, faces and backgrounds of our people are shown on our website. We don’t hide behind a website, app or meaningless mission statement.
Key Currency is Authorised by the FCA (No. 753989). For safety and security, all money transfers are conducted through safeguarded client accounts.
We have gained a 5-star “excellent” rating on the customer review site Trustpilot – the highest rating available.
If you feel our service could be of use to you, simply request a free quote.