Saturday, 7 May 2011

HSBC Georgetown, banking and exchange rates

In the UK I am with HSBC Premier and in readiness for my impending move here I thought I'd pop in to the Georgetown Branch of HSBC in Downing Street to open a local account. You don't need to have your MM2H visa to do this. If you are coming from the Gurney, Tanjung Tokong or Batu Ferringhi side it's dead easy to find by getting on the 101 Rapid bus. As the bus passes the Rapide terminal (on opposite side of the road) just get off at the next stop which is on the Weld Quay road, at the junction of Downing Street. Just walk straight up there to the branch. Standard Chartered is also there. I could have opened the local account from the UK but as I was in no rush I decided to go for the personal visit, more chance to chat to the locals that way too and get more ideas of places to go. As always, there is water and coffee available on the Premier floor and, at the branch near Queensbay Mall, you can even park for up to an hour free of charge in their car park as a Premier Customer.

As I am a Premier Customer in the UK I qualify automatically for Premier in Malaysia so went to the Premier service centre on the first floor (the lift is just inside the branch entrance). Bear in mind you will need to take your passport. Once there I saw the very helpful Chai Pei. The account opening process is quite quick. I opened the Premier (MYR/Ringgit) account and also opened a GB £ account. The Ringgit account is opened free of charge but if you open other currency accounts (useful for holding sums of money until exchange rates are in your favour etc.) there is a RM 50 charge per account, so you could have US $ and Euro too if you like. I was very surprised that they issued me with my ATM card and PIN there and then. Whether it is the same in all branches I don't know but they certainly do this in Georgetown which is the oldest branch here. You will need to change your PIN when you get chance and PIN numbers in Malaysia are 6 figure. One thing to bear in mind is that the ATM card, unlike those in the UK, is not also a Visa debit card, it only works in ATMs. They also issue you with an internet banking secure key token and a telephone banking PIN.

Once all the paperwork is done they will set up the internet banking with you to check all is working and activate your key token. You have to select a user name (to avoid confusion I used the same 'IB' number that you are obliged to use in the UK), a first and second password (they are used for different things) and two security questions. They also explained about a dual currency conversion option they offer. This is useful and while I need to explore the full details it sounds the best way to exchange you imported £ or whatever. Essentially, you can either transfer the money direct from your UK account into your MYR account and you well get the bank rate of the day which tends to be a little lower than exchange rates on the currency markets. Or, you transfer you money into your GBP account and, depending on how quick you want it exchanged, you can opt for a 1 week, 2 week, 1 month, 2 month or 3 month dual currency exchange. HSBC did advise me that 1 month is the longest they recommend as it's easier to predict rates etc. The minimum you can convert in this way is RM 50,000. The bank then basically 'deals' in your exchange currency amount and, at the end of the period you select, they will pay you back the money to be 'parked' in the currency of your choice. This way you will generally get a much better exchange rate (often higher than market rate) and also some interest. Whenever you do such a 'deal' the bank provides a kind of mini contract which sets out the rates, guarantees and such like and you have to authorise it each time. You can also sign an authority allowing you to do this by email. If the dual currency option appeals you have to ask at the branch so you can fill in some pre-authorisation forms but HSBC will likely advise you about all this when there.

On the exchange rate front I found some interesting things. Firstly, in the UK, the Post Office advertise their 'no fee' foreign currency exchange. No fee it may be but the rate they give you is crap. Without doubt the worst option IMO. At the time the £/MYR rate was hovering around the 4.9 mark yet at the Post Office, 4.6!!!! That's around £60 extra to pay on RM 2,500 (you should only bring in up to RM 1,000 by the way). No fee - yeah right!!!! When I switched some currency directly from the UK account to my MYR account it converted at around 4.85 which was better. The best rate I got though was using my UK Premier debit card in the ATM which gave the rate exactly as it was on the currency exchange at 4.91, and of course there is no overseas usage charge with HSBC, or at least with Premier. Without doubt this was the best deal. Clearly you are limited by ATM limits (but these are high with Premier anyway) but for me, and particularly when living here, I think the use of the UK ATM card followed by use of a local ATM card using currency converted at the better 'dual currency' rates will be the best option.

The other thing of note is when you come to link your accounts under the Global View option from the UK internet banking site. Confusingly, when you select Malaysia from the 'add country' options you will be asked for your user name (the IB number in my case) and your 'Memorable Information'. Now, you don't choose anything called this in Malaysia but I can confirm that the information they are after here is the 'Password 1' that you chose at the branch. You then select the characters they ask you for from 'Password 2'. Once you do that it links and you can transfer straight away, it normally arrives (free of charge of course) the next working day in Malaysia.

The other thing I did clarify is that the secure token they give you is not universal, it only works with your Malaysian account. Likewise the UK one (which they are just starting to issue) will only work with your UK accounts.

Overall I found the process painless and efficient and hope this information may be of use to others.

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