Categories
finance United Kingdom

Banking for British Nationals in the EU

This article is relevant for anyone interested in banking while living abroad.

The BBC is reporting that many UK nationals living in the EU have been told to close their British bank accounts by the end of the year. The call seems to have come from Lloyds, while Barclays has informed many Barclaycard holders that it is time for them to move on. The issues I have heard that people will face are not being able to receive UK income, including pensions, and the inability to make payments. Many also have regular standing order and direct debit payments.

There are a range of options that people can look at these include:

  • Opening a specific ex-pat account. These often operate with an exorbitant fee from British territories, not the UK mainland.
  • Opening a GBP account with your local bank alongside your EUR or other currency one. However, these rarely support all aspects such as low-cost incoming payments, direct debits or standing orders. They can also be expensive.
  • Alternative financial providers (what I will talk about here).

Alternative providers such as TransferWise and Revolut offer the ability to send and receive payments to/from a pseudo bank account. They also offer free or very low cost currency conversions. Both also come with a debit card and offer free ATM withdrawals across the world, up to a certain amount.

Neither Revolut nor TransferWise are banks. Therefore, your money is not directly protected via them. Instead, they hold their client funds in authorised banks. This means providing those banks remain solvent, your money should be safe. However, as they may hold the accounts in a different jurisdiction, the level of protection may vary depending on the currency being held.

Revolut

Image (c) Revolut

Revolut offer “virtual” accounts into which you can send and receive GBP and certain other currencies. This means you can hold balances in several currencies without charge. Direct debits and standing orders are available for GBP transactions. You can convert the equivalent of up to €1,000 per month free Monday to Friday, outside of these hours, and the limit you will pay a fee of up to 2%. If you wish to convert more than €1,000 or withdraw larger amounts you either will have to pay each time or join one of their paid plans. They permit one free bank transfer per month, thereafter it is 50c each. Direct debits are free. Depending on where you live, you will receive a Master or Visa card. With this card you will be able to withdraw up to the equivalent of £200 per month in all currencies, exceed this limit and you will be charged 2%. Again, if you join one of their paid for plans, the maximum free amount per month is increased.

Revolut offers a range of other services besides basic banking, such as the ability to buy and sell shares, commodities and take out travel insurance. Fees for these vary from free to a few percent.

This is a pre-paid account with no credit facilities, while you can deposit funds via other credit or debit cards you need to check if your own provider there will charge you a fee. Revolut charges a fee if the top-up card is not from your country of residence. However, standard incoming bank transfers to your account should normally be free.

Revolut comes with a nice little app, in fact you can’t do anything on their website. This also supports splitting bills between other friends who are also on Revolut and information on your spending categories.

Transferwise

Image (c) Transferwise

TransferWise offers a simpler service. Like Revolut, you can send and receive funds and hold balances in multiple currencies via “virtual” bank accounts. They support direct debits, free and work with no issues. Sending money always incurs a fee which has a fixed component and if it involves a conversion, a currency fee. In my experience, this seems to average around 0.5%, although can seem higher for smaller transactions. There are no fancy stock trading markets, plans or split bill options. However, you can use their services via their app or website. They offer free ATM withdrawals up to a limit of £200 per month, above this amount you will pay 2%. TransferWise offer a range of transfer options, ranging from a standard one which can be a few days up to fast transfers for an additional fee. TransferWise do not offer standing orders.

My Experiences

I have been using TransferWise for years; I have used the basic currency exchange, direct debits and multi-currency features. Their service has been flawless. I took out their card and account as I was already using their transfer service.

I only started using Revolut in 2020, mainly as they were offering at that point up to €6,000 in free transfers per month. They reduced that limit to €1,000 per month. If your needs are under this per month (like mine) and you need standing orders they may well be the way to go.

While you can hold money in multiple currencies, often with a bank account number attached. It is worth noting that if you spend money, or undertake a transaction (e.g. direct debit) in a currency that you don’t have sufficient funds in, then a conversion fee will apply (subject to any limits). This may seem like a pain, but in reality it means you only need to convert funds when you need to, rather than worrying about remembering to do so when required.

Summary

In some ways neither of these services a replacement for a full bank account in the UK. However, they offer most of the basic banking services that you should require. Also, if you are likely to send or receive funds and need bank accounts in many currencies, then arguably they are better and cheaper than traditional banks. The free withdrawal limit in any currency may also be better value than using UK bank cards when abroad.

Setting up and using the accounts with both providers is quick and simple. They will be asked for some ID for verification, but again this is a fast process.

Reviews of both companies are positive. However, they have a reputation of locking accounts if transactions look suspicious. Therefore, I would test the water with them first and not use them for your house sale money or anything similar. They are however probably perfectly ok for incoming salary and pension payments, etc. They both offer separate business accounts if that is what you need.

To help the decision process, here are some key points to look for:

  • What basic banking services do I need: standing orders, direct debits, etc.
  • How much do I plan to convert per month between currencies?
  • Do I want an extra debit card?
  • Do I need lots of fancy services like trading in stocks?

If standing orders are vital to you, then Revolut is the only way to go. Although, you can repeat payments made on TransferWise manually if you like (but this will incur a transfer fee).

As some UK banks have given customers brief notice to get their funds out of the UK, these two providers offer a quick way to get a UK bank account into which you can deposit your funds.

For more information, in particular to check out their respective fees and services, please visit their websites:

Revolut

Transferwise

I do not make money if you click on either link above.

Categories
politics United Kingdom

Was “Terrorist Cash” Linked to the pro-Brexit Campaign?

The Open Democracy website reports that the Electoral Commission is investigating Northern Ireland’s Democratic Unionist Party’s (DUP) ability to spend what appears to be in the region of £250k on pro-Brexit campaigns; given that in 2015 the party reported a total income of little more than £500k it is a surprisingly large amount. It is worth noting that unlike mainland-UK political parties, those based in Northern Ireland do not need to declare where there money came from. This is perhaps not a surprise given (that in the interests of fairness) the citizens good state of New York were famous for donating to charities connected to the IRA. I guess when all sides face potentially inconvenient stories about where their money came from it is best to pass a law which exempts all sides. The Democratic Unionist Party is of course no stranger to financial scandals, having had more than it’s fair share of issues with loans and dodgy environmental schemes in recent years. Indeed the Northern Irish Assembly recently collapsed due to corruption allegations surrounding the Democratic Unionists.

Over the weekend and since the first draft of this article was written the DUP have indicated that they have provided the names of the  donors to the Electoral Commission but are so far refusing to say exactly who was kind enough to donate the funds. In a moment of honesty Aaron Banks who famously funded the unofficial Leave campaign alleges that the DUP had previously demanded money from his team in exchange for supporting them. Banks quite rightfully turned this down.

It is worth noting that many leading Brexit politicians also received money to support the leaving of the EU from wait for it, the campaigns themselves. So while the good people of UK who may have legitimately believed in leaving the EU donated some of their hard earned cash to these campaigns their money was being used to pay some of the largest blood sucking lying parasites in recent British political history.

The sources for Brexit funding and in-direct support have also come under increased scrutiny recently, especially given that many leading lights in the UK Conservative Party have accidentally taken money from Russian backed organisations (Source: The Times). Some have even gone as far as to be quite positive of Russia’s invasion of Crimea and have been talking up closer economic ties with Russia post-Brexit. Meanwhile across the English channel, Russian media outlets are now on the rise in France and are supporting Le Pen. Allegations have also been made of strong links between the BNP (British National Party) and leading Northern Irish Unionist politicians.

If the Democratic Unionist Party does not name who provided it’s funding for Brexit and indeed in general then we will only have to assume (perhaps wrongly) that it continues to receive funding from lapsed terrorists and Russia.

For more information on the DUP please check out the following links:

Guy Debord’s Cat (a blog)

Wikipedia

For the record I have no opinion on whether Northern Ireland should be part of the UK or the Republic of  Ireland. That is a decision for the people of Northern Ireland.

This article was initially published on February 19th, 2017. You can check this out on web.archive.org. In the spirit of transparency, my position on Northern Ireland has now changed. I support reunification if most of the people of all of Ireland vote for it. It is up to them.

Categories
politics Russia United Kingdom

UK Conservative Party Linked to the Kremlin (and assorted other nasties)

In the few short months since Brexit, which we were told would be a gift to Vladimir Putin it is now becoming clear that the British Conservative Party has strong links with the Kremlin. Which may also help explain why Russian aircraft are given free tours when they enter UK airspace, er sorry are escorted out of UK territory.

According to The Times a number of senior Conservative MPs and councilors have been writing nice things about the Kremlin’s policy in among other areas Crimea and Syria. Many also received direct benefits or benefits -in-kind. One who benefited was John Redwood (one of Britain’s leading Brexiters) who according to the UK Register of MPs interests had some connections in the Russia direction. Not that there is anything wrong with that. When asked about the money he denied he knew of its origin. Perhaps we should not be overly surprised of his naivety or stupidity, as when he was the Secretary of State for Wales he famously was unable to sing the Welsh National Anthem.

The Conservative Party has never received any money itself from bad sources although one of its previous fund raisers Sir Brian Wyldbore-Smith (yes that is his name) was involved in raising funds from interesting sources. Indeed newspaper articles from the 90s reveal a culture of secret donations but nothing illegal of course.

We should not think of course that there is any link between the increased interest in working towards a trade deal with Russia or in intelligence sharing and the incentives given to leading politicians.

This article was published on my original blog in February 2017. I have kept the original posting date. Those in doubt can check on web.archive.org.

Categories
money laundering politics Russia United Kingdom

UK Set to Become World’s Leading Money Laundry

Canary Wharf, London. Image: Kleon3 / CC BY-SA (https://creativecommons.org/licenses/by-sa/4.0)

In a desperate attempt to prevent the estimated loss of up to 45% of foreign direct investment (Source: London School of Economics) which goes to the financial services sector in the UK, the UK Government is to roll back legislation for money launderers, drug dealers, Middle Eastern Dictators and Russian Billionaires. Theresa May’s recent pledge on a low tax and dynamic finance sector can only mean one thing, more dodgy cash in the UK. Indeed the UK (including some dependencies) is responsible for 4 of the 15 worst money laundering areas in the World, so it already has form. Also many UK banks have been fined by the US for assisting in money laundering.

Capital inflows from illegal activities are nothing new, indeed during the 2008 banking crash the UN estimated that 350bn USD suddenly appeared in the world’s financial system. Much of it making it’s way through British territories and then on to London.

Middle Eastern states and Russian oligarchs have already been very successful in placing cash in the UK financial services sector and (usually) London based property schemes. Some are already believed to have seized on the opportunities that Brexit presents, namely the lack if oversight of where there money comes from. Meanwhile the legitimate operations of many UK financial institutions will simply move to more transparent counties such as Germany, France and Luxembourg. Putting Luxembourg and banking transparency together may sound a little odd, however over the last 10-11 years this tiny country (where I live) has significantly boosted its compliance worldwide with some very thorough “know your client” rules being put in place.

Responsibility for negotiating financial arrangements with non-EU countries will rest with The Disgraced Former Defence Secretary Dr Liam Fox. One should perhaps pay a little more attention to his register of members interests to see just who may wield influence in future.

This article was published on my original blog in January 2017. You can check out web.archive.org for proof.