Do you want to send money overseas? Don’t worry, we have got your back. In this blog, you will read about the best ways to send money internationally!
With the rising popularity of settling abroad, sending money internationally is a favored practice. Millions of households send billions abroad every year. As per World Bank estimation, abroad remittance to middle-and-low income countries is to rise by 1.4% to $656 billion in 2023. And an approx. the cost of sending money abroad is 4-5% of the sending amount. Although the most common place of sending money internationally is a bank, it can be one of the most costly ones.
Whether the funds are for family or friends, transferring large amounts of money is a bit difficult and expensive sometimes. The speed and cost of sending and receiving money affect a lot to the sender or receiver. That’s why we are here with the best ways to send money internationally to choose the most suitable.
Let’s dive in to know!
What is an international money transfer?
When money is transferred directly to the bank account of an individual or any business entity present abroad is an international money transfer. This can be done via a bank transfer, agent, online platform, or money transfer service.
This process may take a few days as the money is exchanged in different currencies offline or digitally. As there are many technical advantages now, one can transfer money from the comfort of their home to any part of the world via money transfer apps or various online platforms. But one thing to note is to know the money transfer limit as per each individual and country.
As you have got an overview of international money transfers, let’s consider some crucial points before sending money worldwide.
Important things to consider before sending money abroad
Exchange Rates
In simple terms, the value required for one currency conversion to another currency. Exchange rates can be of two types: fixed and floating.
The fixed exchange rate is decided by the central bank of the country. On the other hand, floating rates are determined as per the dynamics of market demand and supply.
Exchange rates affect businesses as currency rates can increase or decrease the cost of the supplies during import or export.
Overhead Expense
You can’t send money abroad for free, there are some additional costs associated with it. The overhead charges linked with it are transfer fees, conversion tax, service tax, etc. So, you need to be careful about such additional charges before making a transfer worldwide. The overhead expense can be fixed or depends on the amount you are transferring.
Transfer Speed
Another factor to know before the international transfer is transfer speed. Ideally, it varies from around 48 hours to 72 hours to 1 week. In the case of a cheque transfer, the transfer may take up to one week.
Transfer Amount
‘How much money you want to transfer’ also plays an important role before choosing the medium of transfer. Like, for small transfers, many services are there to help you out. And for large sums of money, some companies do corporate transfers. You should avoid banks in such cases as they charge very high amounts of money.
How you can send money internationally: Best Ways!
1. Bank-to-Bank Transfer
If you ask us ‘What is the cheapest way to transfer money internationally’?
The answer to this is the intra-bank transfers or transfers from the sender to the recipient’s bank account. You can do such types of transactions online, over the phone, or by your physical presence at the bank.
There may be some fees depending on the recipient and sender’s bank or account type. As per some banks’ policies, you may transfer a small amount with their remittance program. In such cases, you have to take care of the exchange rates. As the bank is not charging any kind of fee in such transactions, they may make money off of the transaction fee applicable to the transfer.
2. Global Money Order or Offline Money Transfer
Before the existence of wire transfers or online transfers, money orders were the most favorable way to send money abroad, being budget-friendly too. This was the easiest way to send money globally even for people who didn’t know how to send money internationally.
One can deposit the money order in their bank account or can be cashed at any check-cashing location. Global money orders or offline money transfer is still one of the safest and cheapest ways of sending money abroad.
3. Cash-to-Cash Transfer
If a person has a large amount of money to transfer internationally, they can use a walk-in money transfer center to the global money transfer center.
You can deposit physical money at any money transfer center and then domestic money is converted into the destination country’s currency. And the recipient can receive this transferred money at the respective money center in their country. Many countries also offer to deliver the money to residential or commercial locations.
There are many examples of companies that are offering cash-to-cash transfers, like, Money Gram, Western Union, etc. They have their money transfer centers available worldwide. And many fintech companies likewise, PayPal, etc. also offer such services.
4. Digital Wire Transfer
Online or digital wire transfer is the latest form of transferring money abroad. There are intermediary banks to process such transfers, so the processing fee is low and budget-friendly. Wire transfers are good to send large amounts of money. Generally, this process is initiated with the help of a bank officer at the delivery point or bank who fills out the required forms.
However, they charge a small amount of fee, but in return, they act as an intermediate between the sender and receiver bank. They offer protection from both sides’ banks, so the online wire transfer process is safe to send big amounts of money internationally.
5. Automated Clearing House Transactions
ACH or automated clearing house transactions are similar to digital wire transfers and bank-to-bank transfers being electronic transfers. But this process needs a computer-based clearinghouse to act as an intermediate to process the transfer. It involves an electronic network to manage electronic banking money transfers.
ACH service can be used by any individual, business, or government organization to send or receive money. Generally, automated clearing house transfer is used by employers to pay their employees via direct deposits.
6. Bank Drafts
Cashier Cheques or Bank Drafts are available at various banks across the country. You can simply buy the cashier cheques from the bank outlets in the desired currency of the respective country in which you are depositing the money.
Bank drafts are comparatively cheap but the time required is more than other money transfer services. So, if you are looking for a way to send money at cheaper rates and you have no time limit, then go for bank drafts.
You can track the cashier cheques in case they don’t reach the location in the expected time making it one of the peaceful ways of sending money abroad.
7. Prepaid Debit Cards
Another best way to send money internationally is through prepaid debit cards. The sender and receiver both can have prepaid debit cards to use for money transfers. The sender loads the debit card owned by the receiver with the cash funds.
And the receiver can withdraw the amount from the card or use the swipe debit card wherever needed. You need to pay an activation fee or monthly processing charges to use the prepaid debit card hassle-free.
All these are the basic and best ways to send money internationally. And in this digitally advanced world, there are money transfer apps to make these transactions easier and more convenient. You don’t need to visit banks or physical money transfer stores if you know how to send money internationally with money transfer apps.
What are money transfer apps?
Peer-to-Peer money transfer apps or you can say, money transfer apps allow you to transfer money from person to person. Money transfer apps are a quick, cheap, easy, secure, and convenient way to transfer money internationally. They simplify the payment process by giving you a digital wallet that is linked to your bank account or credit card.
You can make any electronic transfer within just a few taps from your mobile device. You need to choose the best app as required with the best app store ratings.
For example, PayPal is one of the best easy-to-use apps for abroad money transfer. WorldRemit is another popular money transfer app for international transfers. If you are looking for an app for bank-to-bank transfers, Zelle is one of the best applications. And if you want to do a wire transfer, Wise is one of the considerable money transfer apps.
Summing Up
Today there are numerous options available to send money abroad, be it online platforms or companies that assist you to send money. No matter whichever way you choose, make sure to check the credibility of the money transfer app or the company.
But before jumping onto one option, you should compare the exchange rates, processing fees, and the time required for the transaction. If you are in a hurry to send money, go for an instant option. And it’s always advisable to keep track of the transaction to get protection from fraud and delays.
To make it more convenient for you, have a look at the given points:
- If you are searching for a cheaper alternative to send money internationally, go for ACH, Wire, or Cash-to-Cash transfers.
- And if you are in a hurry, go for Bank-to-Bank transfers or prepaid debit cards.
So, this is all about the best ways to send money internationally. Before closing, one more mentionable point is to thoroughly check the receipt’s account details once before sending money.
Hope you find this blog informative!