I’ve learnt some lessons around trying to do banking, payments and transfers overseas and I just thought to share in this post what those lessons were.
This post is aimed at long-term travelling. I won’t be touching financial products like travellers cheques, and so on.
These points, in my eyes, are more of an introduction which is great for those that are researching, or they are just starting out. It would be great to get to a point when I can give advice after 10 or so years but I haven’t been to that stage myself yet!
Banking – opening an account
Please note that this post does not take into account offshore banking solutions.
The first time someone looks at the requirements banks have to open an account, it’s generally seen as a complete inconvenience. How can you provide an electricity bill to open a personal account if you have only just arrived? Why should you bill a lawyer to write a character reference for you when you open a business account?
My advice – do not worry if you think that you are unable to meet the requirements stated on their official documents and website.
I have found that banking rules for opening personal accounts tend to be liquid. For example one of the banks required a character reference but I haven’t provided one. Another bank will call for a household bill, yet again I haven’t provided one. A tenancy agreement is also requested, but what happens if you are only there for the short-term? A quick call to the bank to explain the situation and they gave me the workaround for this. However, even a phone call was not required when I was able to walk into my Canadian bank with my documents and cash to deposit and was able to open an account that very same morning.
Banking – closing accounts and gaining back long-lost accounts
Now, I’ve thought about closing accounts and even have attempted some account closure only to find out that the bank has not even closed it. This was unbelievable when I found out that an account that I thought was closed actually wasn’t. Luckily, there were no overdraft on that account or nor were there any fees added.
When you close an account make sure it is actually closed! I had to reconfirm my identity with one of their customer representatives in order to gain access to that account. At some point I was asked to go to the branch, but since there were no branches nearby it was done over the phone. They needed to get a manager in at some point.
In the end, I didn’t mind since it turned out that I’d prefer having a bank in that region. Even though I haven’t lived there for a couple of years, I have plans to come back from some time and at least I don’t have the hassle of opening a bank account there.
Banking – The case for having multiple bank accounts
There are quiet a few benefits in terms of having a local bank to where you are living. For example, if you are going to be in the EU for a long time, it makes sense keeping an EU account. I am also constantly making transfers in my home country bank which is why it is being kept despite having to pay account keeping fees.
There are also non-banking reasons to keep multiple accounts. One of those reasons is the concept of maintaining proof of ties back to your resident country. Local bank accounts, beyond the benefits of saving in international transfer fees, are also preferred in some situations.
Banking – The case for not having multiple bank accounts
Should I close my bank account when I move overseas?
If you maintain a bank account, it may be considered a secondary proof of tie in determining residency status for activities like accounting. This is the case especially in determining the tax withdrawal rate of pensions.
Another case for closing a bank account is peace of mind – you are not worried about potential fees or issues surrounding your old bank account such as fraud.
Banking – you will most likely have at least two
I think the verdict is that most people who have moved overseas generally have at least two banks – one in the new country, and the second in their home country.
Banking – keep them up to date with your movements
It is very important that your bank is kept up to date with your movements, and that they have the most relevant contact information available.
When I first moved to Ireland, I only withdrew a small amount which turned out to be enough to last about a very frugal 3 months and by that time I had started building my savings into my EU account. Therefore, I made budget-conscious decisions to limit my spend to this pot of cash that I had withdrawn.
I ended up using an international card to make a large purchase – which was my resident visa. Ideally, I would have put all my expenses under the initial cash I withdrew but there was a time limit to get this visa and I ended up spending some of the budget on various doctor appointments having gotten sick in Ireland.
You may want to mirror my approach – which is to withdraw enough to last until you get your first payment or income into the local bank account. This usually involves doing some forward planning, forward budgeting… and optimism!
I believe in maintaining a sizeable liquid base as an emergency fund. So right now, I want to still keep to my initial cash withdrawal – yep, 3 months later I still have some money left! – and not touch anything until I have what I would deem an acceptable local emergency savings fund.
With PayPal you are required to have separate accounts for each bank account.
Due to vulnerabilities and attacks in the past, especially around social engineering, PayPal has various authentication requirements for logging in. This means that you may have issues going through their secondary authentication page, such as identity confirmation via SMS, if somehow you trigger a suspicious login from a different location. If your mobile/landline number is constantly changing then this is going to be an issue.
I’ve found that logging in using a localized VPN can help. For example if you are usually logging in from Montreal, it makes sense having a VPN that can configure to a Montreal IP. Connect to this VPN before going into PayPal.ca and it can help not triggering any suspicious activity warnings. This happened a few times, but it seems as it’s not 100% foolproof. When my attempt to log in failed, I decided to remote into one of my computers that’s in that local IP but still I couldn’t log in.
If you don’t have a localized VPN or you are still not let through, the next step would be to contact support. I’ve found that their email support is not helpful and that the other way is via their call centre.
Before I call, it’s useful to have as much details as you can. They will ask you for various details to confirm your identity. I’ve talked to a few representatives. One, I think, seemed to have training against suspicious calls and was asking me for more and more details. One person was somewhat helpful in that once I send through additional details to confirm identity, she mentioned about being able to ‘loosen restrictions’ around account login. So, it seems that they can’t guarantee 100% you will have access to that account after the call but can ‘loosen restrictions’. I remember being able to log in the day after. The third person that I have talked to was completely hopeless. She went as far as telling me that it’s not possible to log in from overseas and that I had to give whoever is in that country access to my account (ie password!) which goes against privacy. The phone call was ridiculous so I hanged up and tried again later.
PayPal verdict – only as a last resort
PayPal is more of a last resort, simply because it’s too difficult going around their various geographical barriers, their fees, lack of consistency with customer support and so on.
Unfortunately I haven’t been on the cryptocurrency boat and I wish I should have back in 2012 when I set up my first Bitcoin wallet. However I can see how this is useful when you are travelling around the place to have access and use something like cryptocurrency.