Consumers risk cash crisis when moving overseas

As technology opens up opportunities for more people to become digital nomads*, and people start to move across the globe again**, findings from HSBC reveal that international citizens’ financial experience may not be all plain sailing.

HSBC’s study was commissioned to understand how international citizens’ financial lives are evolving, their motivations for moving abroad, and issues they face as they settle into their new home.

The bank estimates there are over 90 million*** international customers across just 10 of its key international markets – people already living, working and studying abroad. The research lays their financial challenges bare – the pressures of relocating and the practical impact it can have on their lives.

Half (50%) of survey respondents who have relocated agreed that they felt unsettled when they first arrived because they struggled to set-up important things like a bank account, utilities, and the internet; highlighting how complex financial admin can have a negative impact on their new experience. Without a bank account, they can struggle to secure a home – and without a fixed address, struggle to get children in schools.

Key concerns of those who have moved or plan to move overseas are: 

• More than 1 in 2 (54%) people surveyed, who have already relocated, agree that being unable to transfer their credit history led to struggles setting-up essentials, such as a mobile phone contract or credit card. Half (50%) planning to move overseas also agree that this is a concern for them.
• Among those planning to relocate, nearly half (48%) expect a cashflow crisis upon arrival; and just under half (47%) agreed that not knowing how to juggle financial life between locations was a concern - this jumps to 53% among international students.
• Almost three in five of the future relocators (59%) are concerned about the implications of paying taxes in a new country.

The study comes as HSBC is relaunching its international products and services – to better support customers across borders, for a seamless cross-border experience, whether they’re moving for work, study or to live in a new location.

Commenting on the findings, Jessica Power, Head of Wealth and Personal Banking for Australia at HSBC said: “Moving abroad is a significant milestone and achievement, so managing your finances between international locations shouldn’t be a struggle. The research findings indicate that there is a real concern for some people to experience a ‘cash flow crisis’ when relocating and setting up your personal finances abroad, which can really impact their ability to settle in their new home.”

“Providing people with the ability to make cross-border payments that are convenient, transparent and competitively priced, together with the option of being able to open a bank account before they move overseas, sets people up for success when relocating. Having the right financial support such as managing banking needs across different time zones and multiple countries can also help reduce the time people spend worrying about money matters, and instead make more time for them to enjoy their new life abroad.”

Motivations for moving

As inflationary pressures and the rising cost of living affects consumers in some countries and territories, HSBC found the top three reasons respondents are motivated to move to Australia are for a better work/life balance (31%), improved health or social life (31%) and the opportunity to travel (24%).

Almost a quarter (24%) of respondents are motivated to move to earn more money, and almost 1 in 5 (17%) move (or plan to move) to make their money go further. Yet one in two (52%) respondents who are planning to live, work, or study abroad say that nobody has helped them feel financially prepared to relocate.

A majority (60%) of respondents who are planning a big move, agree that finding the right financial services to suit their needs was a worry. This rises to over two thirds (64%) among digital nomads*.

Top reasons for relocating to work or study abroad among international citizens in the survey

About the survey

The study, conducted by Ipsos UK, surveyed over 7,000 adults across nine international locations. It investigated the experiences of those currently living, working and studying abroad, as well as those who are planning to do so and those who have returned within the last five years. It explored the experience of a range of different international citizens, including expat families, digital nomads and overseas students. Further methodology details in the notes section below.

HSBC support for international customers

The suite of HSBC International products and services will enable international customers to:

• Open a new account via a digital and frictionless journey before they arrive in their destination
• Premier customers can see all their HSBC accounts in one global view
• With Global Money Transfers customers can make simple, fast and competitively priced payments.
• Use their HSBC credit history from their previous country to apply for a credit card in their new country with HSBC (subject to local regulations, Premier status and applicable channels)
• Manage their banking needs in different time zones across multiple countries with global support ****
• Access services with global partners beyond banking (tax solutions, relocation support).

The products and services are available across 10 countries and territories: Australia, Canada, Mainland China, Channel Islands & Isle of Man, Hong Kong, India, Singapore, UAE, UK, US. More information here: https://internationalservices.hsbc.com/