Visa Payment - what will it cost (exactly)?

[legomanzeal]

.Hi everyone

 

Just wanted to share our journey and discoveries to the benefit of anyone that might be paying for their visa soon.

 

First, as one would expect, we checked https://immi.homeaffairs.gov.au/visas/visa-pricing-estimator

 

Our result was (AUD5630):

 

 

Not too bad, we thought. But how did they arrive at that exchange rate?

 

If you look here, it makes sense: https://immi.homeaffairs.gov.au/help-support/applying-online-or-on-paper/online/how-to-pay

 

 

So that means, if we pay today, 2018-12-19, the exchange rate of 1 January to 30 June 2018 would be used. I remember ZAR being quite strong then:

 

 

And indeed, the average rate is close to the R9.75 per AUS$ implied by their estimator. In reality, things were quite different.

 

Initially, we tried using my Capitec debit card for payment (for both VISA and Mastercard you need to add 1.32% as card fee), as I know that they do not charge a currency conversion fee for international transactions. After setting my temporary international point of sale limit to a number that was definitely sufficient, we found the payment being declined. We ended up calling the Capitec call centre twice, and eventually, it transpired that the maximum international card payment that could be facilitated by the Capitec/Mastercard agreement is R50000. You cannot arrange with the bank to exceed this limit. 

 

Next up, we tried FNB. I was reluctant to use them because they charge a 2.75% currency conversion fee, which on R56636 would be a staggering R1557. Crazy. But we had to. I ensured that I had at least R60000 available on the FNB credit card but this time the transactions were declined due to reason: insufficient funds. How was this possible? Within moments, I received a call from the FNB fraud department, just confirming that it is me trying to make the payment because someone is trying to pay Australian Home Affairs with an amount exceeding the available balance on the credit card. I asked him if he could see what that exact amount was, and he told me, just short of R61000.

 

I found that the amount charged to my VISA card could be arrived at here: https://usa.visa.com/support/consumer/travel-support/exchange-rate-calculator.html

 

If you use Mastercard: https://www.mastercard.us/en-us/consumers/get-support/convert-currency.html

 

 

So there you have it - should you plan on paying your visa application, the amount you will pay in ZAR is nothing like what their visa cost estimator would suggest. Rather use the relevant card company exchange rate calculator website. Our effective exchange rate (factoring currency conversion fees of 2.75%, card processing fees of 1.32%) was 10.827 ZAR to AUD.

 

If you bank with Capitec,  should your costs exceed R50000, you'll have to use another bank to make the payment.

 

 

 

 

 

 

 

 

 

 

 

 

Edited December 19, 2018 by legomanzeal

[lindav]

Thanks for the great post, I always appreciate some practical detailed advice! To add my experience: For anyone with Standard Bank, I highly recommend using their Shyft app for overseas payments, which is what I did for all my Australian payments, as well as various other things. You transfer money from your Standard Bank bank account to the app, and then buy AUD. The beauty of it is that, you can do it in small increments over time, so you can keep a look out for when the exchange rate is a bit more favourable. I found that, with AUD, the price you pay is about 0.15 ZAR more than the "spot" price you'd Google (e.g.  if the Google exchange rate at the time is 10.25 AUDZAR, you'll pay about 10.40 AUDZAR in Shyft). I think the traders call this the spread, and the amount seemed quite reasonable and better than I noted on those exchange shops. I played around with larger and smaller amounts (buying increments of e.g. 50 AUD vs 500 AUD), but the variation stayed the same. Which means that I slowly bought AUD over multiple months, so I wasn't at the mercy of a once-off exchange rate. There were no other fees involved with buying the currency. Over the last couple of months, I think my average AUDZAR exchange rate has been about 10.4.

 

The other beauty of the Shyft app is that you can create a virtual card, which I did to pay all the Aus visa fees (DHA and skills assessment). It creates a new mastercard number, cvv, expiry date etc. I then put the money in there, and used that virtual card to make payments. I felt better doing this, as I was working through an agent and really prefer not to hand out my credit card and cvv details over email, I didn't think the bank would look favourably on any future fraud cases if they find out I did. So when the time came, I just moved the AUD I had collected to the virtual card, gave those card details, and it all worked beautifully. When the payments went off, it was exactly the AUD amount, so I had no surprises with exchange rates. I didn't notice any other fees, so the only cost is the spread. That virtual card is now empty so my normal accounts and cards are safe. When I made overseas EFT payments directly from the AUD wallet, there was a cost of AUD 18 for each payment. 

 

And no, I don't work for Standard Bank or in the financial sector, and not promoting them, I just found it all worked so incredibly well. I love and appreciate a great piece of technology.

 

Just one thing to be aware of, once you've transferred the money to the app and bought foreign currency, it's properly offshore (it uses your SARB foreign allowance of R1mil per year). So I don't know if you could bring it back easily. So I was really nervous that I'd be collecting AUD there and then something wouldn't work (had read about the virtual card not always working for purchases on Amazon.com), which would mean I'd have to then revert back to my ZAR credit card, with my AUD stuck there. I figured I'd need it eventually in the future, and can exchange it for USD/GBP/EUR and use it for other things, so it didn't bother me too much. In the end, it all worked fine. 

 

I'm sure FNB would have something similar, where one could buy foreign currency over time? I know friends who use their Global Account to buy USD, but not sure how it works and if it would work for payments.

Edited December 19, 2018 by lindav
clarified something

[FingersCrossed]

Hi

 

I also used Shyft to move money over with no problems. Works perfectly each time.

[legomanzeal]

13 hours ago, lindav said:

I'm sure FNB would have something similar, where one could buy foreign currency over time? I know friends who use their Global Account to buy USD, but not sure how it works and if it would work for payments.

 

 

I was thinking of using the FNB Global Account should Capitec fail me, and I should have investigated this more. But by yesterday I have not ordered (nevermind received) a Global Account Card yet, so it was too late by then. One potential issue I thought of, concerning the FNB Global Account, was that should the payment fail (like with Capitec, for whatever reason; I've never used it), I have to transfer the funds back to my ZAR credit card incurring another spread loss.  Has anyone used their FNB Global Account to pay a visa?

 

 

[F1veClaw]

1 hour ago, legomanzeal said:

 

I was thinking of using the FNB Global Account should Capitec fail me, and I should have investigated this more. But by yesterday I have not ordered (nevermind received) a Global Account Card yet, so it was too late by then. One potential issue I thought of, concerning the FNB Global Account, was that should the payment fail (like with Capitec, for whatever reason; I've never used it), I have to transfer the funds back to my ZAR credit card incurring another spread loss.  Has anyone used their FNB Global Account to pay a visa?

 

 

Have the same question about FNB since they are my preferred bank. I have a friend who currently lives in Aus, and swears by Shyft (although he is a Std Bank purist)