Sending Money Abroad with HSBC: Everything You Need to Know

Thinking of using HSBC to send money abroad? While the bank is one of the most-established and most popular in the UK, users should be aware of the hidden fees that the bank charges on international money transfers, and mindful of the lower-cost alternatives.

Founded in 1865 in order to facilitate financial activity between Europe and Asia, HSBC is one of the most-established banking institutions in the world. HSBC serves over 40 million customers worldwide and operates in 64 countries. HSBC UK is specific to the UK and is one of the UK’s “Big Four” banks, alongside Barclay’s, NatWest, and Lloyds.  

Given both its history and its international network, international transactions are at the core of HSBC’s operations. Indeed, HSBC allows its UK customers to make transfers of up to £50,000 to 150 countries in the beneficiary’s local currency and provides some of the lowest fixed fees for international money transfers amongst traditional UK banks. 

This, however, doesn’t mean that HSBC is the best choice for you. HSBC is reliable, but it’s rarely the fastest nor the cheapest option to send money abroad. While its fixed fees may be low – allowing it to be one of the better options for international money transfers amongst traditional UK banks – its exchange rates are not competitive, so customers should be aware of hidden fees. 

After all, you don’t want to pay more, and you certainly don’t want your beneficiary to receive less.

What Will HSBC Charge You? 

On the surface, HSBC claims not to charge you a fee for online international money transfers. The fine print reveals however that there are only two scenarios where HSBC UK will not charge you a fee for sending money abroad: 

• If you’re sending money in Euros and sending that money to an account within the European Economic Area (EEA);
• If you’re sending money from your HSBC UK account to another HSBC account. 

As these scenarios are limited and as the UK is leaving the EU, that means that you will face fees when making international transfers with HSBC. So what exactly do they charge you?

• A £4 fee to send money internationally;

But that isn’t all… 

HSBC’s Exchange Rates: Beware the Hidden Fees

What traditional banks don’t tell you is that they make a lot of their money in hidden fees, especially when it comes to transferring money internationally. 

Well, quite simply, this is due to the exchange rate margin. When you make a foreign transfer, you essentially sell your British pounds to your bank, after which they exchange your money at or below the mid-market rate, and then charge you a percentage so that they can make a profit. So say you want to send £100 to India. You see via Google that this should get your recipient INR 9,512.* With HSBC UK however, only INR 7,794 arrives in India. That’s a difference of 1,718 Indian rupees or 18 pounds sterling – almost 20% of your transfer! 

Shockingly, that isn’t all. According to their site, HSBC “only” charges you £4 to make your transfer, but what they don’t tell you is that if your recipient isn’t with HSBC themselves and HSBC UK doesn’t use a local bank account to pay out the transfer, then additional fees will be charged by the receiving bank. With your £100 transfer to India, Monito estimates the additional fee would be around £13.48, bringing the total hidden fees to approximately £31.48 – or over 30% percent of your transfer. 

*values given on September 10,2020. 

The Costs Combined

Since HSBC also charges you £4 to initiate your international transfer, that means that the fees on your transfer consist of an initial transfer fee, the exchange rate margin, and likely a hidden receipt fee. With the above example of a £100 transfer to India, that brings your total fees to £35.48 – over 35% of your transfer. These specific fees will vary depending on the country you’re sending money to and the day’s exchange rates, but the practice remains the same.

All data from September 11, 2020. 

The takeaway? Hidden fees take an enormous amount of money out of your remittances. Fees get proportionally smaller the more money you send, but sending more money is rarely a solution. What is? Avoiding international transfer providers who hit you with hidden fees. 

Sending Money Abroad with HSBC: Other Fees to Anticipate

While exchange rate fees make up the bulk of the fees you’ll pay in making an international money transfer with HSBC from the UK, you may be hit with additional fees depending on whether you are a Premier or Advance customer, whether you’re making your transfer online or via phone, and if there are additional charges from the beneficiary bank.

• For Premier customers: a £4 fee to make a transfer online or a £9 fee via phone. 
• For Advance customers: a £6 fee to make a transfer online or a £14 fee via phone.

International Transfers with HSBC Global Money Account

In addition to sending money abroad using traditional transfer methods, HSBC customers in the UK are set to gain access to a brand-new money transfer service from 2021. This service, the Global Money Account, was designed by HSBC in an attempt to win back customers who had turned their backs on traditional banks in favour of cheaper money transfer alternatives such as TransferWise and CurrencyFair.

To do this, HSBC Global Money Account is set to offer a mobile-based platform on which HSBC customers can hold, manage and send funds abroad in multiple currencies to other HSBC customers around the globe, all without any transfer fees. According to HSBC, the app will be rolled out to its customers throughout 2021, so be on the lookout for its arrival if you'd like to stick with HSBC while saving on international money transfers.

Be aware, however, that although the app will not reportedly not charge any fixed, commission, or bank fees, you'll still very likely be paying the hidden exchange rate margin fee. Exactly how much this fee will constitute — and how transparently it will be advertised — remains to be seen.

Is HSBC Right for You? 

All things taken into consideration, HSBC is an internationally respected and recognised bank who can be trusted with your transfer. If you bank with HSBC in the UK and value the ease of making your international money transfer straight from your account, it may be for you. Additionally, if you'd like to make low-cost transfers without signing-up with a third-party transfer service, then HSBC's Global Money Account may give you everything you're looking for.

If however you are interested in keeping costs down and are open to making your international transfers and remittances through a third party, then there are lots of lower-cost alternatives at your disposal. Monito regularly evaluates and reviews them for comfort of use, security, and speed, so you can be sure that whichever service you choose through Monito’s search engine will get the job done. 

For these reasons, we recommend that you explore your options through Monito’s search engine and find a transfer provider who will get your money to your beneficiary safely, securely, and more quickly, all at a lower cost.

All data from September 11, 2020. 

Alternatives to HSBC UK to send money abroad

• TransferGo and Instarem are good alternatives to send money to the US
• Remitly and XE are cheaper alternatives for money transfers to Pakistan
• CurrencyFair and Wise are cheaper ways to send money to the UAE
• Remitly and XE are good options to send money to India
• Remitly and CurrencyFair are good alternatives to send money to South Africa
• Skrill is a cheap and fast way for money transfers to Ukraine
• Remitly and XE are cheaper alternatives for money transfers to Sri Lanka
• Remitly is a good and fast alternative for money transfers to Turkey
• Remitly and XE are cheaper alternatives for money transfers to Bangladesh
• Transfergo is a much cheaper way to send money to a bank account in Qatar
• Remitly is a good and fast alternative to send money to Nepal
• Transfergo and Wise are well rated alternative to send money to Canada
• WorldRemit and Remitly offer cash pickup and bank deposit on money transfers to the Philippines

Data last updated on the 17th of August 2022