A cheaper way to send money home.

vpainter,

My understanding is that the decision is yours - you can request for some of your pay to be into an account in KSA and the balance to be paid in sterlings, euros, or USD>

You are mistaken. As previously advised, global payroll will deposit whatever amount of your salary you authorise into your local Saudi bank account and the balance will be deposited into your home bank account. If you receive this as sterling, euros etc then the conversion of your dollar salary to the currency of your home bank is determined by SA exchange rate at the time of the transaction. The rate is cleary shown on your payslip every month.
The protection mechanism you talk about, is unlike dollar payroll who have a fixed exchange rate against SAR (meaning their salary is the same every month), global payroll suffer from the prevailing exchange rate ( to the currency of your chosen "home" bank) every month. In order global payroll do not lose out due to exchange fluctuation the protection mechanism is in place but previous contributors have shed doubt on its effectiveness.

Hi Omega,
Not really sure what you are saying.
1. On global payroll you do not opt in or out of the currency protection scheme, you are in it from the time you step on the plane to come here. Your protected rate is set then and stays at that rate for your entire Aramco career. If exchange rate of dollar (what you are paid in) drops by more than 5% Aramco pick up the difference (you have to take the first 5% hit). See pg 33 of the relocation and orientation guide you should have received,
2. As your career lifetime protected rate is set as soon as you step on the aircraft there maybe
circumstances where you will benefit or lose out dependant on how long you remain in KSA and currency fluctuations of the dollar versus your home country currency,
3. From what I have seen Aramco rate looks slightly better but I don't really track it. At the end of the day you get what you get. You could get all of your salary paid into a local KSA bank and then disburse the money yourself if you have the inclination and want to track rates. Hope this helps

Omega - regarding #3 in your post, the Aramco exchange rate is the best one going, as you get the full market rate.

For example, on my most recent paystub I got an exchange rate of 1 USD => 1.33 CAD.

If I check the bank rates today, they only offer about 1 USD => 1.29 CAD. So, I lose 4 cents on each Canadian dollar I buy.

Some of the private currency exchange companies, like Currency Fair, have better rates than the banks (e.g. 1 USD => 1.31 CAD), but still not as good as what Aramco gives.

I did open both CAD and USD accounts here, but don't use them much, unless I end up with a surplus of SAR and want to send money home.

If you do choose to get part of your payroll deposited In-Kingdom, note that for local deposits the only currency offered is SAR (if you want to get paid in EUR, you have to provide a foreign bank account).

So if you get a payroll deposit here, it will be in SAR. If you then want to switch it to EUR, without sending it outside KSA, you will have to transfer it from your local SAR to local EUR account manually. At that point you will likely take a bit of a hit on the exchange.

If your end goal is to end up with your money in EUR, you'd be better off sending your pay straight to your home bank in the EU, since you get a better exchange rate like I was mentioning. That said, you may have a reason to park your money here first, so it's up to you.

For the FX protection scheme, you can't really lose. If your home currency weakens against the US Dollar, then you enjoy the benefit of the exchange rate (33% for me this month). I actually cheer each time the Canadian dollar weakens, though I'd never admit that to my friends back home ("Another 3-cent drop? That's terrible. So sorry.")

If your currency goes the other way and gets stronger than the USD, then you're protected by the FX scheme. You really get to have your cake and eat it too.

Reviewing a post earlier in the thread by Atactic, I was wondering if someone had an update about the actual conversion rate from SAR to USD for let's say a premier/elite member in a Saudi bank. Is it 3.75? Or do the banks ask for a premium, even for elite/premier members?

Lastly, when in global payroll with home currency being EUR, is it possible to ask Aramco to split the payment in SAR (deposited in local bank) and send the balance to a USD denominated account abroad? The key difference is that the balance of the money would not be sent abroad in EUR (which is the home currency and the currency protected by the FX Scheme) but rather in USD.

CanadianBacon,

Regarding your post, If your currency goes the other way and gets stronger than the USD, then you are protected by the FX scheme. You really get to have your cake and eat it too., bear in mind that if your currency gets stronger than the dollar you will be exposed to some losses.

Lets say that the currency protection rate for the EURO to the $$$ is 1.37 USD to 1 Euro.
If the Euro strengthens against the dollar, you'd bear the loss for any drop in the rate until the drop gets to 1.55 USD to the Euro which is when the 5% protection kicks in.

However, you also stand to gain if the $$$ becomes stronger than the Euro.

So either way, there is a little risk involved.