September 19, 2006

How to have a better banking experience in Honduras

In the last article, I wrote of some of the frustrations of banking in Honduras. In this article, I'll tell you how to make your life a little easier.

All banks offer accounts in U.S. dollars and Honduran Lempiras. Although the exchange rate has been stable for more than a year, it's best to maintain accounts in both currencies. Some companies, such as cell phone, cable, and others, bill in U.S. dollars and charge a higher exchange rate if you pay in Lempiras.

Some banks also offer accounts in Euros, but Banco Atlantida on more than one occasion has refused to make withdrawals from a Euro account explaining that they don't have any, telling the person to come back next week. (A Banco Ficohsa representative told us that this is completely illegal.)

If you have monthly income from the U.S., have it sent to a U.S. account from which you can write checks and have online access. Write a check from your U.S. account and deposit it to your Honduran account. You'll need to plan ahead because the cash won't be available for at least 3 weeks, but you'll save a lot of money on bank transfer fees or courier services. Mailing checks from the U.S. through regular mail is out of the question.

Before opening an account in any bank, read their brochure or internet site to find out what services are offered. Do not rely on what the clerk will tell you. Not all banks have online access or the ability to accept payments for utilities or government-related things, such as taxes or car registrations. It is not unusual to have to withdraw money from one bank and physically take it to another bank to make a payment, which can mean an hour or more in each bank. Checks will not be accepted. And don't even think about sending a payment through the mail − this is Honduras.

Ensure that your joint accounts are properly set up or you will find that your husband or wife cannot replace a debit card or order checks without your permission. Don't take the clerk's word for it. Verify it with a supervisor.

Set up online banking access for your Honduran account. Transfers between accounts (dollars to Lempiras, Lempiras to checking) can be made online, but be sure to print out a copy of any dollar conversions to take to the bank to get official divisas if you need them for your residency requirements. (And don't believe the clerks when they tell you that they don't give divisas for online transactions − it is required by law.)

Utilities, cell phone bills, and car registrations can be paid online. Since bills are rarely sent and the mail is unreliable, online banking is the best way to keep up with these bills. Payments to third parties who have accounts with your bank can be made online as well.

Get an ATM debit card. Five years ago only some of the gas stations and larger stores accepted debit cards. Now more and more stores and some smaller restaurants are accepting them. There is no fee for ATM cash withdrawals on certain 'premier' accounts and even on smaller accounts, the fee is only 10 - 30 Lempiras (approximately $.50 to $1.50) depending on whether you use a ATM machine within your bank's system. An ATM card is not only more convenient, it is much safer than carrying around wads of cash. Just be sure to ask if there is an extra charge; some stores add anywhere from 3% to 10% for the privilege of using a card.

Online banking and an ATM card will greatly limit your need to actually go to the bank. When you do have to go in person, try to plan your trip for Monday through Thursday but not on the 15th or end of the month. Don't go at lunch time because invariably the only person who can help you will be at lunch.

Keep your American credit cards and pay the monthly bills online with your U.S. account. Honduran credit card companies charge monthly interest and service charges totaling approximately 60% annually. Yes, 60%, you read that right!

Don't expect to be able to pay by check anywhere. If you have been doing business with someone for awhile, you may be able to write a check but most one-time or large purchases will require a cash payment or a direct bank deposit to the person's account. If you do make a direct deposit to someone's account, be sure to get a legible copy of the receipt.

And finally, save your debit card receipts and check your accounts and balance them monthly with a calculator. In Honduras accounting systems, debits do not have to equal credits.
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