Co-op launches foreign service
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Your support makes all the difference.CO-OPERATIVE Bank has launched a cheap service for sending money abroad.
The bank is charging a flat fee of pounds 5 for transmissions to France, Belgium, Germany, Italy and Canada. It hopes to extend the service to all other European Community members by the beginning of next year and to bring in more non-EC countries, including Switzerland and Austria.
The bank is offering the service through a link-up with other European co-operative banks. The banks have set up an electronic network enabling them to swap information quickly. They then use their local cheque-clearing networks to debit or credit accounts.
Each of the banks involved in the system agrees not to levy charges from the recipient's account, so there should be no additional fees on top of the pounds 5. Payments will be converted into foreign currency at a standard margin of 0.35 per cent over the Co-op's daily rate.
The service is available in the UK through Co-operative Bank's 110 branches, and can be used by people without accounts at the bank.
The bank expects the service to be used by anyone wanting to make regular or one-off payments to companies or individuals abroad. A typical customer would be the Briton with a holiday home abroad who needs to pay regular bills. It can also be used by insurance and pension companies to make regular payments. Businesses will be able to negotiate discounts on the pounds 5 charge if they are regular heavy users.
Banks offering the service undertake to have the payments made within set times of between three and eight days depending on the destination. However, these times may be extended if payments in the country of destination have to be sent on to an institution that is not a member of the local clearing service. Many UK building societies are not members of the British payment clearing service.
The cost of sending money abroad and the time it can take are a source of vexation to consumers and to the European Commission.
Before launching the new service, Co-operative Bank conducted research on alternative money-transmission services. It sent pounds 100 from various British banks to accounts in France and Belgium. The money sent to France took from three days - through Barclays and Bank of Scotland - to nine, and the cost to the UK accountholder ranged from pounds 5 at TSB to pounds 23.34 at National Westminster. The NatWest figure included pounds 11.34 charged by a bank in France and passed on to NatWest, which then charged the UK customer.
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