Highly important: Make especially sure that you check the regulatory credentials of any non-bank foreign exchange specialist. Ensure the company operate segregated client accounts & have a proven track record in business

Individuals and families who are considering making Aliyah & setting up a life in Israel will no doubt need to make provisions for how to make and receive international money transfers. Transacting with a non-bank foreign exchange specialist or ‘money changer’ does offer the ability to cut the cost of payments in comparison to banks.

With literally thousands of currency brokers globally to choose from, it is incredibly important to safeguard your funds and ensure you transact with a reputable & reliable foreign exchange specialist. Wherever in the world you are sending money from, keep in mind the following three steps to checking your currency broker is safe and secure.

1.Regulatory Credentials

Profile very carefully the regulatory credentials of your money changer. To ensure brokers are fully compliant, they need to adhere to strict anti-money laundering & know your customer regulations. I’ve outlined below some of the organisations and government bodies in the UK, Australia, Canada & USA which regulate the money transfer industry.

UK

– FCA Authorised & Regulated (Financial Conduct Authority) & Registered with HMRC (Her Majisties Revenue & Customs).

In the UK, watch out for smaller brokers who are simply ‘registered’ with the FCA as a small payment institution rather than fully authorised. This implies they transact smaller volumes or haven’t submitted an application for full authorisation. Steer clear and only opt for large organisations that are FULLY authorised.

Australia

– Hold an Australian Financial Services Licence (AFSL) issued by the Australian Securities & Investments Commission (ASIC)

Canada

– Money Services Business (MSB) & registered with the Financial Transactions & Reports Analysis Centre (FINTRAC)

USA

– Registered Money Services Business with FinCEN 

2.Operate Segregated Client Accounts

Before you open an account & transact, ask your money changer if they operate ‘segregated client accounts.’ These are separate from the day to day running of the company business accounts & safeguards your funds. In the event of the currency broker running into financial difficulty, your funds are protected.

The video on security of funds created ‘‘ Is your foreign exchange company safe and secure’’ is a must watch before transacting.

3.Three to Five Year Minimum Track Record in Business

Money changers can be found everywhere from the high street to deep in the financial district of many cities. Don’t take a ‘salesman’ word on face value and ensure the company has a minimum track record of at least three to five years in business. Ask questions related to segregated client accounts, regulatory credentials and business track record. Try to figure out recommendations from friends & family too.

In short, there are many reputable & highly competitive non-bank foreign exchange specialists on the market. With some careful planning & asking the right questions, you will be well on the way to securing a fantastic exchange rate.

Daniel Abrahams divides his time between London & Tel Aviv, is an entrepreneur & co-founder of independent OPP award winning foreign exchange comparison website MyCurrencyTransfer.com. Daniel is a keen personal finance blogger and his opinion is regularly covered in: The Telegraph Expat, ThisisMoney & Entrepreneur Country. You can contact Daniel directly on Daniel@mycurrencytransfer.com.

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