UK consumers, who send or receive foreign payments, could be paying well over the odds for their currency due to a lack of transparency in the foreign exchange sector. This coupled with the effects of the credit crunch, has caused a financial and currency specialist to highlight the issue of fairer pricing for British consumers.
The currency market (worth approximately $1,683 billion a day in the UK) is completely unregulated and this could be leading to banks and foreign exchange companies failing to understand and comply properly with the Consumer Protection Regulations which were introduced in May.
The regulations require all companies to openly tell consumers how a price will be calculated. Helen Scott, entrepreneur and managing director of 4X Currency Corporation, the world’s first online currency exchange company, believes that this should now be highlighted as an issue as the law may be being broken at the expense of the consumer. She is calling the Financial Ombudsman Service to look at this sector much more closely to try and bring some simplicity to currency pricing.
Helen adds: “It seems incredible in the age of the internet that consumers are able to openly compare the price of almost any other commodity except currency. Yes, rates move, but consumers should insist on asking how the rate will be calculated when they come to do the deal. Ask how much they will charge away from the rate given on the BBC website in percentage terms. Dealing rates vary enormously between providers, costing thousands on a simple overseas property purchase. We wouldn’t dream of buying a car, holiday or anything else without shopping around and getting the best deal - so why should be accept it with our hard earned cash.”
Jamie Hanley Partner at Leeds law firm Morrish and Co says: “Consumer protection is at the heart of government policy on regulatory reform. These Regulations simplify and standardise the law and are wide ranging. They outlaw unfair trading, and are designed to ensure that a consumer is able to make free and informed decisions. Transparency in business dealings is clearly at the heart of this. That the government is serious is illustrated by the fact that both the OFT and local trading standards are given wide powers to investigate and to take enforcement action. It covers all traders dealing with individual consumers. Banks and financial institutions are not immune from scrutiny under this regime.”
Helen concludes: “A lack of transparency just results in customers becoming more confused and ultimately they are unable to directly compare the costs of a transaction. I have found it hugely frustrating when speaking to people who have been confused by indicative rates provided rather than the dealing rate they finally receive. So I am calling on the Financial Ombudsman Service to look at this issue and ensure all providers are acting correctly. A truly transparent marketplace is good news for everyone including the consumer.”
4X (www.4xcurrency.com) operates in a unique and price transparent way, providing exchange rates that customers can actually obtain at that particular time, rather than rates that are merely indications based on the bank’s wholesale (interbank) rate. Dealing rates are posted clearly on the website and the exchange rate is updated up to three times a second, made possible by unique software.
Notes to editor:
• 4X Currency 4X Currency is a registered overseas money provider with HM Revenue and Customs
• 4X Dealer™ is a registered trademark of 4X Currency Corporation
• 4X Dealer™ can process 2,000 trades per second and transfers can be made to any worldwide bank
• 4X Dealer™ has been designed especially with the business market in mind to enable companies to receive live, up-to-the-minute, market rates so that they select the most favourable ones available before making a transfer.
Contact: Chris Norton/Jed Hallam
+44 (0)113 394 7960 Mobile: 07932 864 891
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