Shifting money

For years and years I've had a bit of a deal going with some friends who have a holiday home here in Spain. They pay money in sterling into my UK account and I pay Euros into their Spanish account using the FT exchange rate. They get money to pay their direct debit bills and I got enough to service my Amazon habit.

The more usual methods of transferring money can be quite costly. There are all sorts of schemes and methods but most of them make their money by giving below the "money market" exchange rates (the ones that say no commission) or by charging a fee. To give an example for small amounts, say £300, my normal method is to use an account I have with the Nationwide. They charge me £1 per transaction plus 2% of the amount. So that's £7. Actually that's as cash so it's a bit different but the figures are illustrative.

Recently Cliff told me about a scheme that he had heard described as peer to peer. It's what my friends and I have been doing all these years except that the firm charges a commission and I don't. In these schemes the money goes between bank accounts.

I used the company for the first time last weekend. I paid my Pounds into the firm's account in the UK. Somewhere in Spain  a Pedro, Paco or Maria wanted Pounds and they paid Euros into the same firm's Spanish account. The firm pays me with P,P or Ms money, the firm pays Pedro, Paco or Maria with my money and takes a commission from both of us. The commission rate on the same £300 seems to be around £1.50. In effect it's a national rather than an international transaction

If only we'd been smart enough to realise we had a business idea my friends and I could be rich by now!