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Cash at Christmas: the perfect present for those far away

banknotesCash is a brilliant present. Yes, it might be unimaginative but I would far rather have a crisp banknote than some present that I’ll hate – I’m being practical, if ungrateful here. But of course you cannot put bank notes in the post – particularly if you’re sending money to friends or relatives abroad. And anyway, you don’t want to send them sterling but their local currency. So how do you send cash for Christmas?

The cheapest way is to use a currency broker. But while they offer good exchange rates they are really designed for large sums of money (say, the deposit for a property purchase) – not £100 changed into Aussie dollars for your cousin’s Christmas present. You will need the recipient’s bank account details or email address at least.

You could use your own bank to make a transfer. It will be convenient, safe and you can send smallish amounts – but it could be slow and expensive. You’ll also probably get a less attractive exchange rate usually than through a currency broker. You will need your recipient’s banking details.

Money transfer firms – mainly Western Union and MoneyGram – are fast and you can opt for the recipient to get instant cash or have the money paid into an account. But these services can be pricey. For Western Union sending £100 to France – with the money to arrive in minutes – would cost £9.90 if the recipient wants cash. Based on Western Union’s exchange rates on Wednesday the recipient would have got E109.94.

There are other options too – peer to peer online service TransferWise covers more than 30 common currencies – on Wednesday if you sent £100 to someone with a Euro-denominated account the recipient would have got E111.99 after fees. There’s also a comparison site – www.fxcompared.com – where you can check for the best deals.

Another idea: Paypal. As long as the recipient has (or sets up) a PayPal account you can send money this way really quickly. The fees depend where the money is going and how you are funding it (it’s cheaper to use your PayPal account than a debit or credit card). For sending to France, the PayPal funding fee is 0.4% or 3.8% if using a credit or debit card.

Ok, all these ideas do mean your recipient loses the element of surprise. But then, at least you know they will use your present ....

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Tuesday, 18 December 2018