Transferring Money between Germany and Australia

You will have to pay many of the items which we discuss below by transferring money from Germany to Australia. Unfortunately this can be a costly and sometimes nerve-racking business. The official Australian currency is the Australian dollar (officially designated as AUD and often written as A$, and in Australia simply as $). Make sure that you do not confuse the Australian and U.S. dollars, because they have independent values. You should realise that currency values can change quite sharply and unexpectedly, so beware that you make an allowance for such unexpected changes. We begin by providing some basic information and tips about the exchange rate between the Australian dollar and the Euro.

The Exchange Rate

The Australian Dollar (AUD) is not linked to the U.S. dollar (USD) so that the Euro-AUD rates do not necessarily move up and down in the same way as the Euro-USD rates. But the rates do change minute by minute.

You can find the actual exchange rate, which changes minute by minute if you visit the XE website www.xe.com or by checking the ZDF or ARD teletext information.

You should realise that this rate can change very quickly. For example in June 2005, when the French and the Dutch rejected the proposal for a European constitution in separate referenda, the Euro fell rapidly to about A$ 1.55. But then with the global financial crisis it suddenly became as high as A$ 2.10.

On the website www.xe.com you will find a calculator ("Universal Currency Converter") which automatically calculates the current value of an amount of Euros into AUD or the value of an amount of AUD into Euros at the current exchange rate.

Transferring Money to Australia

Most people use a German bank to transfer funds to Australia. This is not cheap. They will give you a worse exchange rate than that which appears on the XE website. In additional most will take a commission for their services. In view of the relatively large sums which you will have to pay to the Australian university for tuition fees it may be worth your while to ask several banks about both exchange rates and commission fees.

However, the XE website provides an alternative for transferring Euros to Australia, which I can strongly recommend (although I am not prepared to give you any guarantees). I have recently used this service several times and I can confirm that I have found it both cheaper and quicker than normal bank transfers. I have also found it to be very reliable, and its telephone enquiry service is very helpful.

You can reach the XE website service for foreign exchange transfers at http://www.xe.com/xetrade/

As I said above I have recently used this service several times. In my experience it is considerably

  • cheaper than that of the German banks, because there is no fee involved (except a small telegraphic transfer fee) and because they give you an excellent exchange rate. They claim that their exchange rates are the best available and I believe them, but even so you should be aware that it is less than the exchange rate which you see on the www.xe.com webpage.
  • faster in my experience than that of the German banks. I was amazed when I first discovered that money which I transferred to Australia was on my bank account there within about 24 hours, compared with several days for the normal inter-bank transfer system.

There is one point of which you should be aware, if you plan to use the XE trading system. You cannot simply go to the website and initiate a transfer or make a bid. Before you use the system you (or for example your parents) must register with XE and provide details of your bank accounts in Germany, which will be checked. This process takes about a week, in my experience.

After you have registered you can log in to their system to initiate transfers and to make bids. When you have initiated a transfer you can follow its progress as it is being processed and delivered, and you will also receive emails advising of its progress.

When initiating a normal transfer you can see exactly what exchange rate you will get, and this changes every minute. Be careful only to finalise the transfer when you are sure that you want to proceed, because there is no turning back at that point.

The website offers some alternatives to making transfers at the current offer rate. I have found the bid method especially good. Using this method you can in effect say what exchange rate you would like to have and how much money you wish to transfer. There is no guarantee that you will get the rate which you specify. But if your bid can be filled at a later time, you receive an email advising you of this and then within three days you must make the money available to a bank account specified in the email. The bidding system allows you to wait for an exchange rate without you having to watch the exchange rates all the time. I also have had good experiences with this system and it is now the main method which I use to make transfers.

A Canadian bank (Custom House) is behind the XE trading system, which is reassuring in view of the World Economic Forum's newest findings that the Canadian banks are the soundest in the world!

The bank possibly avoids international bank transfer fees because you only have to transfer funds from your German bank account to their German bank account in Frankfurt, so that in Germany you in effect make a normal local inter-bank transfer. XE stipulates that you make this transfer telegraphically, which means that your local bank will charge you a fee of a few Euros. In turn the XE system apparently transfers the funds to its Australian bank account, which then transfers your funds to the Australian bank account specified by you. The transfer to the Australian bank will normally also be made telegraphically, at the cost of a few Australian dollars.

Since writing the above I have discovered that some universities offer a special payment method via Custom House. It appears from information provided to me by a student that this also has a good exchange rate (certainly better than the German banks). So if you wish to avoid the problem or time delay of registering with XE you could use this method. However, as far as I know you cannot make bids, and you cannot use this payment method to transfer other money (e.g. for living costs).

Credit Cards and Bank Cards

A relatively cheap way of transferring small amounts of money to Australia in my experience is to use a German credit card. One tends to receive a relatively good exchange rate (but not as good as by trading with XE), based on the day when the credit institution receives the bill in Australia. There is usually also a relatively small commission payment, which you should be able to discover by asking your bank or financial institution.

There is a further advantage of having a German credit card while in Australia. Australians use credit cards much more freely than Germans, and you will find that it is almost essential to have a credit card when shopping in Australia.

However, applying for an Australian credit card can be a huge problem for international students, unless you can find an Australian resident to vouch for your creditworthiness. Most applications by international students are rejected by the Australian banks! So I would strongly advise you to obtain a credit card from a German bank before you fly to Australia!

It is also worth considering opening an account with the Deutsche Bank, because this bank has an agreement with the Westpac Banking Corporation (one of the major Australian banks) which allows you to obtain cash from the Westpac ATMs using your Deutsche Bank card.

Important

I have tried to describe the costs which you will have to pay to study in Australia and also the possibilities known to me for receiving assistance with paying these costs. This information is intended as a help for you but I cannot guarantee that it is correct or up to date. I strongly advise you to check the information sources which I have provided, and where appropriate other information sources, to make sure that you are aware of the latest rules and regulations before you commit yourself to costs which you intend to incur for studying in Australia.