CBA to pay correspondent bank fees on international money transfers

The Commonwealth Bank says it will save international money transfer (IMT) customers more money by absorbing fees charged by correspondent banks.

For those who aren’t fluent in IMT fees lingo: correspondent banks are the banks receiving your money overseas. These banks may charge you an additional fee on top of what you’ve already paid. Typically correspondent banks deduct a percentage from the total amount sent, and you only discover how much was deducted once the transfer arrives at its destination.

CBA’s announcement comes two years after the Australian Competition and Consumer Commissions’ (ACCC) inquiry on transparency guidelines for IMT providers to give customers better pricing transparency.

“Our customers have told us it’s hard to predict the cost of IMTs, especially when correspondent banks around the world deduct fees from a customer’s transfer amount,” says CBA executive general manager of payments, Ethan Teas.

The bank began absorbing fees last year, but only to their top currencies: USD, EUR,GBP and NZD.

“We received such positive feedback from our customers that we decided to extend it to all of our offered currencies to more than 200 countries,” says Teas.

Alongside the new correspondent banking fees absorption, CBA has made new changes to their foreign exchange services:

• AUD to NZD transfers reduced from $6 to $1 until 21 January 2022.
  
• Transfer fees waived for South Pacific currencies (FJD, PGK, SBD, VUV and XPF).

If you are interested in learning more about sending money overseas check out Mozo’s country guides for transferring money internationally.