International transfers and cross-border payments nearly always incur costs, whether hidden or explicitly stated. These can be fixed fees or percentage rates and vary greatly depending on:
- Which countries send and receive the payment
- Whether it is a card payment or account transfer
- Which banking networks are involved
- Whether currency conversion is involved
In the EU, for example, the SEPA banking network connects participating Eurozone countries to enable cheap Euro-currency transfers between those countries. Since the UK transacts in GBP and has left the EU, transfer between SEPA and the UK incur a cross-border charge in most cases.
Internationally, the SWIFT network allows global transfers between bank accounts. These are usually the most expensive, for example £15 for the sender or receiver.
If a currency exchange takes place (e.g. when transferring money from a USD-currency account to a GBP-currency account), a conversion fee is usually added. A significant example is PayPal who applies a 3% currency conversion fee above the base exchange rate.
Transferring between accounts in the same currency does not incur this fee. This is why multi-currency account providers like Revolut and myPOS are cheaper for merchants with international clients, as you can just use the euro account for euro transactions and keep the pound sterling account for domestic transactions.
Non-domestic card payments or cash withdrawals may also incur international card fees in some cases.