Deposits and withdrawals with local methods
What you learn in 3 minutesThis lesson explains how money reaches a trading account from an Australian bank, and how it comes back. The words used on the deposit screen are the first thing to read, because each one has a different cost and a different speed.
Three routes for A$500
| Step | Amount | Note |
|---|---|---|
| Deposit by PayID | A$500 | Sent from an Australian bank account using a mobile number or email. Usually credited within minutes during business hours. |
| Deposit by BPAY | A$500 | A biller code and reference number are used. Funds normally clear in one to two business days. |
| Deposit by card | A$500 | Card deposits are often instant, but the broker may add a percentage fee. That fee varies between brokers. |
| Withdrawal back to the same method | A$500 | The amount returns to the source. Processing time varies between brokers and can be one to five business days. |
| One pip on one standard lot of AUD/USD | A$10.00 | One pip is 0.0001. One standard lot is 100,000 units. 100,000 x 0.0001 = 10 units of the quote currency, which is USD, converted at 0.6640 to about A$15.06. |
A broker may round the converted pip value, charge a deposit or withdrawal fee, or apply a currency conversion spread. These charges vary between brokers and are shown in the product disclosure statement.
The mistake people make here
The common mistake is depositing with a card because it is fast, then asking for the withdrawal to a bank account. Most brokers send the money back the way it arrived, so the card is credited first. If the card has expired, the return can be delayed while the broker arranges another route. Before depositing, check the withdrawal rules for that method and keep the deposit amount modest until the full round trip is understood.Check yourself
A deposit of A$500 is made by card. The broker charges a 1.5 per cent deposit fee. How much reaches the trading account?
1.5 per cent of A$500 is A$7.50. The amount credited is A$500 minus A$7.50, which is A$492.50.
One pip on one standard lot of AUD/USD is 10 USD. At an AUD/USD rate of 0.6640, what is that pip worth in A$?
10 divided by 0.6640 equals about A$15.06. The pip value in A$ changes as the exchange rate changes.
A withdrawal of A$300 is requested on a Monday. The broker processes it in two business days, and the bank adds one more business day. When does the money normally arrive?
Two business days from Monday is Wednesday. One more business day is Thursday. The money normally arrives on Thursday.
In Australia
- Currency
- The Australian dollar, written A$ or AUD.
- Common deposit methods
- PayID, BPAY and cards. Availability varies between brokers.
- Regulator
- The Australian Securities and Investments Commission, ASIC.
- Withdrawal rule
- Money usually returns to the same method used for the deposit.
- Processing time
- Broker processing and bank clearing both take time. Total waits of one to five business days are common and vary.