“Deciding to retire abroad presents quite a quandary for our clients, as the vast majority of pension schemes are sterling denominated,” explains Andy Brown, Operations Director, Equiniti Paymaster International Payments. Although a great many retirees choose to have their pension paid in sterling, despite living in a non-sterling state, this isn’t as simple as it might first seem. “It’s not as easy as it sounds,” Andy explains. “Sending a cheque isn’t very secure and is open to a high degree of risk.
“The options seem limited; either force people to keep a bank account open in the UK or offer members an individual money transfer into whichever country they live. Both of these options are fairly impractical in the long term and do present some concerns.”
However, as Andy explains, there is a third option, which is cheaper, more efficient and safer for the retiree and the business administrator.
“At Equiniti Paymaster International Payments, we pay more than 50,000 pensions overseas every month,” Andy says. “Banks do offer this service, but they charge considerably for it – anywhere between £20 and £30, whereas we charge less than the price of a high-street sandwich.”
A currency exchange service is also something to consider, but again as Andy explains it will come with hidden costs: “If the member was to use a currency exchange – a money wire service like Travelex or Western Union – this is likely to involve partner or correspondent banks, each of which is entitled to apply a ‘lifting fee’. These are hidden costs that you can do nothing about and must be settled by the remitting bank.”
Lifting fees are often something that the pensioner is unaware of, but can be mitigated in the interest of the customer. “For a long time, we have managed payments beyond pensioner payroll, such as accounts payable, and if there were hidden fees there, it would greatly damage customer relationships,” Andy says.
“But lifting fees can be avoided by using an automated clearing house (ACH). An ACH does not apply these charges and payments move straight into a country’s clearing system. These payments are automatic and electronic – otherwise referred to as BACS payments in the UK. They are high volume and low cost, which is why we can charge as little as £2.75 per transaction,” explains Andy.
Equiniti Paymaster International Payments has a relationship with Citi and is able to take advantage of its network of 130 countries. “The most common currencies we make payments to are the euro, US, Canadian, Australian and New Zealand dollars and the South African rand. There are also quite a few exotic locations that we transfer money to,” says Andy.
So there is a way that pensioners can get access to their money faster, more securely and without paying huge fees, regardless of where they choose to retire, and that service is with Equiniti Paymaster.
For more information contact Paymaster International Payments on: 01293 604567 or email email@example.com
Image from Getty Images.
Where in the world
Asides from Europe and the USA, Equiniti Paymaster International also regularly sends payments to the following exotic locations:
- Cape Verde
- Costa Rica
- Sierra Leone
- St Kitts & Nevis
- St Lucia
- St Vincent & Grenadines