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A Complete Guide To Sending Money Overseas

Updated on June 08, 2022 02:42 pm
a man happy that his money has transferred online successfully

Sending money internationally may be costly, with hidden fees and variable currency rates affecting the amount you spend on international money transfers.

An international money transfer takes place when money is sent to a friend, relative, or a company in another country in a specified currency and amount. It may or may not include the exchange of physical currency, such as if the money is being given to the recipient in cash. It can be done using a variety of financial institutions, international money transfer companies, online platforms, or individual agents. 

An international wire transfer, on the other hand, is an electronic transfer of funds from one country's bank account to another country's bank account via an electronic payment network. There is no physical exchange of cash in such transfers. The payments are settled electronically.

Most international wire transfers are done via the SWIFT network by using a SWIFT code, also known as a BIC (Bank Identifier Code). SWIFT stands for Society for Worldwide Interbank Financial Telecommunication.

SWIFT is a messaging system that allows banks all over the world to connect safely and swiftly in order to make cross-border payments. There are about 11,000 member banks in 200 countries and territories that are part of the SWIFT network.

What Is A Remittance Corridor?

A remittance corridor is a channel through which funds flow from one country to another. Consider the remittance corridors between the United States and Mexico or the United Arab Emirates and India. Corridors are one-way streets, which means that finances only flow one way. 

India, China, Mexico, and the Philippines are at the top of the list of countries receiving the most remittances. Countries such as the United States, Germany, the United Arab Emirates (UAE), Saudi Arabia, and France, on the other hand, have a large outflow of remittances.

Some countries have an extensive outflow and inflow corridors. The US-Costa Rica remittance corridor, for example, is greater than the Costa Rica-US remittance corridor.

Money transferred back to migrant workers' home countries is typically referred to as remittance. Every year, hundreds of billions of dollars in remittances are sent around the world. Remittances to developing nations are predicted to reach $630 billion in 2022, up 4.2 percent from 2021, according to World Bank estimates.

Important Things To Consider When Sending Money Overseas

Exchange Rates 

Whether you need to send money to family in another country or make international bank wire transfers, if currency exchange takes place, it’s subject to an exchange rate that fluctuates every day and is calculated at the time of the transfer. 

Foreign exchange is the process of converting one currency into another at a set rate known as the foreign exchange rate. The conversion rates for practically all currencies are continually fluctuating due to supply and demand market forces.

Banks and money transfer providers make money by adding a margin to the mid-market or interbank exchange rate (as determined by a Google search), charging transfer fees, or a combination of the two.

Many money transfer providers claim to offer competitive exchange rates, but once the costs are added up, you may find that you have spent more than you anticipated. 

Use a search engine to find the current mid-market rate of your selected currency pair before proceeding with the transaction to determine how fair an exchange rate you are being provided.

You are generally shown the exchange rate you are being offered while calculating the conversion rate, depending on the money transfer provider you have chosen. You'll see the rate for your money transfer after you've filled in all of the needed information for your currency exchange before you confirm.

Some companies do offer the mid-market exchange rate, while others may offer marked-up exchange rates. Some may allow you to lock in a favorable rate for a set amount of time so that rate fluctuations don't affect your transfer.

Even though the exchange rate is not a fee, it is a cost of money transfer that must be considered. It will determine how much money will be received on the other end or how much money must be given to ensure that the recipient receives the needed amount.

Customers may be subjected to hidden fees in the form of a marked-up exchange rate, demonstrating a lack of transparency in remittance charge structures.

Transfer Fees

Transfer fees can range from $0 to $30 and up, depending on the money transfer service provider, the method you pick to send your remittances, the amount of money you're transferring, how you pay for the transfer, how the money is received, or the speed of the transfer.

When sending money via banks, transfer costs are expensive. In addition, some banks may charge fees for incoming and outgoing wire transfers.

Some money transfer providers charge a percentage of the amount being sent, while others charge a flat fee per transaction with no hidden fees. Some may charge lower costs in exchange for poor exchange rates, or they may charge no fees but profit from the difference between their offered rates and the mid-market rate.

Faster delivery is always accompanied by increased transfer expenses. If you are ready to pay a larger transfer charge, your receiver can receive the funds immediately. When compared to bank account or debit card transfers, credit card payments have greater costs. Direct cash transfers are also speedy, but they come with greater costs.

To entice customers, many companies provide discounts, special rates, and fee-free first transfers. Luckily, because it is a competitive market, getting the best exchange rates and paying low fees is easier.  

On most specialist money transfer companies' websites, you can use a price estimator to double-check an estimate before sending it.

Transfer Speed

Domestic bank transfers can almost be instant. However, international bank transfers can take longer. International bank transfers usually take 1 or 2 business days but can take as long as 5 business days, depending on various factors. 

The following factors determine the speed of your international money transfers: 

  • Currency Conversion

International bank transfers usually need currency conversion and can take longer since the process of converting the money to the recipient's currency takes time. However, it does not always imply that the process will take longer; it all depends on the provider.

Some, for example, allow customers to initiate the transfer in the recipient's selected currency. Others have relationships with other financial institutions that enable them to convert the currency instantly.

Also, all money transfer specialists offer a unique set of currencies, with some specializing in specific foreign exchange groups while others offering a broad range. The provider's resources and experience with the foreign exchange in question affect how long it takes to convert your currency pair.

So, the transfer time for an international money transfer to arrive at the recipient’s location is dependent on the money transfer company. 

  • Security Checks

When it comes to international money transfers, both customers and banks prioritize security. Customers want to know that their money is safe, and banks must ensure that the funds are safe as well. Every banking institution conducts its own security checks to ensure that the details of every overseas transfer are correct.

Banks and money transfer firms must also follow local and international governing bodies' rules and regulations, which may entail additional checks outside their control. These processes are in place to prevent fraud. While these procedures and standards are necessary to ensure the safe and secure flow of funds, they slow down international money transfers.

The time it takes to do these security checks varies by country and depends on what needs to be verified when processing the payment.

  • Destination Country 

Where you send the money will determine the transfer speed. Sending money in one of the most widely traded currencies, such as the US dollar or the euro, is faster than sending money in a weaker currency. It could take a single working day, or perhaps minutes or hours. 

However, due to the processing time at the receiving end of the transfers, as well as the destination country's banking infrastructure and regulations, it may take longer than 5 days. Each country has its own structures and protocols, which can cause the transaction to take longer.

  • Transfer Day

International bank transfers include money traveling across time zones, and each financial institution has a daily deadline for completing money transfer requests. If the transfer request is made outside of business hours, on the weekend, or on a public holiday, this will almost certainly result in delays. There is no certainty that all involved financial institutions will be operational at the same time, depending on the remittance corridor.

  • Payment Method

Money transfer companies allow you to fund your payment in a variety of ways, including bank account transfer, credit card, debit card, cash, and more. The time it takes for money to get to the recipient's destination is affected by the payment method. 

A transfer funded by a credit card, for example, takes less time than a transfer funded by a bank transfer to the provider.

  • Transfer Type

An online international money transfer can take anywhere from 1 to 5 business days to process. If you choose a cash transfer service like Western Union or MoneyGram, the funds are ready the next day for the recipient to collect.

  • Interbank Transfer 

Many banks have overseas branches across the globe. The processing time for a bank transfer to the same bank in another nation is faster than if the money is sent to a different bank. 

Generally, when two financial institutions don’t have a relationship, an intermediary bank is used to mediate the transaction, which prolongs the procedure.

Options For International Money Transfers

Banks

International wire transfer through your bank is the easiest option, but they are not the cheapest. As a transaction cost, banks charge a significant up-front fee and often add a margin of 3-5% on top of the mid-market rate.

The cheapest means to send money overseas are bank drafts, cashier's checks, and ACH transfers. They are secure because they can be traced if the cheques or drafts do not arrive at the intended destination in another country. They do, however, take longer to reach the recipient. 

So, if you're not in a rush, they're the cheapest option. Banks also have hidden expenses such as correspondent fees (third-party fees) and recipient fees that you or your bank have no control over.

Money Transfer Companies

Money transfer companies offer more specialized services and are generally less expensive than regular banks due to lower overhead. This translates to lower transaction fees, more transparent prices, faster delivery, a better exchange rate than banks, and a better customer experience when sending money internationally.

These online money transfer apps or companies also take advantage of mobile technology by developing money transfer apps with a variety of features that are simple to use and equally reliable, making the money transfer process faster, more transparent, less expensive, extremely convenient, and accessible anywhere and at any time.

The best way to decide which provider suits you best is to get to know the answers to the following questions. 

  • How much are you sending?
  • What method are you using to pay for the transfer?
  • Is your recipient a bank account holder?
  • How would you like the funds to be delivered?
  • How quickly do you want the funds to arrive at their destination?
  • Is speed a top priority for you?
  • How much will the transfer cost?
  • What is the current rate of exchange between your two currencies?
  • Are there any hidden fees that could increase your bill?
  • Is your money protected?

There are several money transfer companies on the market to send money internationally online. It can be difficult to choose just one option when there are so many to choose from. To assist you in making your decision, we've compiled a list of ways to send money online. 

XE Money Transfer

XE is a great option for big bank-to-bank transfers. It allows international wire transfers to an overseas bank account in more than 60 currencies using the XE website or mobile app.

There are no fees for transfers of $500 or more. They charged markup exchange rates ranging from 0.5% to 2%. The margins contract as the transfer amount increases.

You have the option to send up to $500,000.00. (or the equivalent in another currency). And use a bank account, credit card, or debit card to make the payment. Extra costs apply when paying with a credit card.

Third-party fees may apply since XE uses the SWIFT money transfer system.

Most transfers take a few minutes or up to four working days, depending on the currencies.

A cash-pickup delivery option is available in the Xe app. Your recipients can pick up their funds at a specific store, an XE branch, or from a list of partners.

Wise

With Wise, there are no markups on exchange rates. Wise's exchange rates, or mid-market rates, are the same as those found on Google. Thus, your recipient receives a larger sum of money. You can send money online with low fees and real exchange rates from 59 countries to over 80 countries. It now has 12 million users worldwide and counting.

Wise also has a multi-currency account that allows you to hold up to 50 different currencies and convert them for a modest fee.

Fees are computed as a percentage of the total amount of money sent. The more the amount being moved, the more expensive it is. The proportion varies depending on the currency selected on their pricing page. The cheapest alternative is a bank transfer, but it is also the slowest.

Your overall spending will be influenced by how you pay for your transfers. Wise accepts payments by bank accounts, debit/credit cards, SWIFT, and PISP.

Depending on the currency combination and payment method, the transfer speed will vary. It merely takes a few minutes to complete the fast transfer. Depositing money in the bank can take up to two days. Transfers across the SWIFT network might take anywhere from 2 to 5 business days.

Skrill 

Skrill isan online money transfer service that lets you send money in 40 different currencies to a bank account, Skrill mobile wallet, email address, or phone number in over 180 countries (all options may not be available in all countries). You can also use them to buy and trade cryptocurrency.

You can create a Skrill account on the website or through the Skrill app.

Skrill makes money by charging a markup on exchange rates of up to 4.99%of the entire value of your payment. Transferring money from Skrill to Skrill incurs a 2.99% fee.

Transfer fees vary depending on the payment method. Debit card, Paysafecash, and Sofort/Klarna bank transfer payments cost up to 1%, while credit card payments cost up to 2.99 percent.

Manual bank transfers can be completed in as little as 2 hours. Most transfers arrive on the same business day. However, it could take up to 3-5 business days, depending on the payment type and how the money is sent.

Instarem

Instarem, an internet remittance service provider, enables money transfers to over 55 countries through its global network of over 8000 institutions.

Instarem also gives currency conversion rates in real-time. The exchange rates are not inflated in any way. There are no further charges.

Fees will vary based on the sending country and the remittance route. For each transaction, it could range from 0.25 percent to 1 percent. The transfer fees are shown before sending money.

Bank transfers, wire transfers, debit cards, and credit cards are among the payment options accepted by Instarem. Various payment types may be accepted depending on the country from which you are transferring money. Use the Instarem app or go online to sign up.

The majority of the transfers are completed in a matter of seconds. It may take more than two business days to reach the recipient's bank account, depending on the destination countries, corridors, and payment type.

Because it is less expensive, Instarem is particularly popular for small transfers. Each transfer gets you InstaPoints, which you can use to make another transfer in the future.

Remitly

Remitly is a global money transfer service that sends money to over 100 countries from 21 sending countries. It mainly serves immigrants who are looking for low-cost, convenient, and speedy money transfer services. You can send money through their website or app.

They accept a number of different payment methods, including bank deposits, cash collections, mobile money, and home delivery. The country to which you are transferring money will affect the delivery methods and speed available.

For first-time users, Remitly offers great promotional pricing. If you refer your friends to Remitly, you can earn referral bonuses.

Remitly has two alternative transfer speeds:

  • Express: Money is delivered as soon as possible. Higher costs apply, and payment must be made using a debit or credit card. Additional costs apply to credit card payments.
  • Economy: Money is sent in 3 to 5 business days. It has reduced fees and is funded directly from your bank account.

The amount of the transfer, the delivery speed, the method of funding the transfer, the destination country, and the manner of receiving the money all influence the overall transfer fees.

The possible exchange rate margins range from 0.5 to 1.5%. By registering with them, you will be able to compare prices.

State Bank of India-California (SBIC)

SBIC is a subsidiary of India's largest public sector bank, the State Bank of India. SBIC is one of the quickest methods of sending money to India from the United States.

You can send money to any bank in India for free in a matter of hours using SBIC's remittance service. You have three options for sending money to anyone in the United States: online, SBIC mobile app, or in-branch.

They offer affordable USD to INR conversion rates. Exchange rates fluctuate based on the quantity and form of transfer. Tiered exchange rates for in-branch transfers imply that the higher the transfer amount, the higher the exchange rate.

Making an online transfer is free of charge. For payments under $50,000, in-branch remittance fees are $15. There is no charge for transactions of $50,000 or more.

For accounts opened online, the daily and monthly transfer limitations are $25,000 and $50,000, respectively. For accounts opened in branches, the daily cap is $50,000. There is no monthly restriction, though. Mobile transfer limitations are $25,000 per day and $50,000 per month, respectively.

More than $35,000 in online transfers may take an extra 1-2 working days.

ICICI Bank Money2India

Money2India is an online money transfer service offered by ICICI Bank. The ICICI Bank is India's largest private sector bank.

Money2India allows you to send money from the United States, Singapore, and the United Arab Emirates to any of India's 75,000 bank accounts. Neither you nor your recipients need an ICICI bank account to use the service.

Register online or download the Money2India app to send money to India.

You can send money in nine different currencies with their Power Transfer service: USD, CAD, GBP, SEK, CHF, SGD, HKD, and AED. If you are a non-resident Indian, you can send money to your NRE account in India.

The majority of transfers are completed within hours, but this varies depending on the country, payment method, and delivery method.

There is no transfer fee if you send more than $1000 from the United States to India. Transfers under $1000 incur a $4 fee. Transfers from Singapore to the UAE are free. However, transfers from the UAE are charged 12 AED.

You can lock down your chosen exchange rate once you've opted to make a transfer. Because exchange rates fluctuate, double-check them before making your transfer.

Panda Remit

Panda Remit is a low-cost international money transfer service that operates in more than 30 countries. You can send money via the Panda Remit app or online.

You can use a bank account, a credit card, or a bank account to make a payment. Transfers funded via bank transfers are free. However, payments made using credit cards are subject to surcharges.

Panda Remit markups range from 0.02% to 0.62%, depending on the exchange rate. There are no hidden costs. By selecting the sending and receiving countries or the currency combination and then entering the transfer amount into their online calculator, you can verify the rates and fees.

Use referral bonuses, special rates, and free transfers for new clients to save money.

The money can be sent to the recipient via direct deposit to a digital wallet, bank card, or cash pickup. It is possible to send money in as little as 2 minutes.

If you are not totally satisfied, they provide a money-back guarantee.

Pangea

Pangea facilitates international money transfers from the United States to 40 nations across the world in a fast, secure, simple, and cost-effective manner. In the United States, Pangea is not available in all states. Make sure it's available in the states where you live.

Use their website or the Pangea mobile app to send money overseas.

Cash, debit card, or bank transfer are all acceptable methods of payment. You can pay with cash if you live in Illinois.

You can send money to a bank account, a debit card, a mobile wallet, or a cash pickup location. Bank-to-bank transfers are only available to Mexican recipients. Direct deposits to debit cards or mobile wallets are possible in several countries. The number of cash pickup locations in Pangea is in the thousands.

The destination country and payment type determine the transfer fees. They charge a fixed transfer cost and a transparent exchange rate. When you refer a friend, you can earn $15 on your next transfer.

The bulk of payments are made in less than 24 hours. If you pay using a US debit card, the transaction takes less than 30 seconds.

On Pangea, the daily maximum is $2,999. The smallest amount that can be sent is $20. Pangea is an excellent platform for sending money to Latin America and Asia.

Paysend 

Paysend is an online money transfer service that allows you to send money to over 150 countries across the world. You can send money online or use the Paysend app to send money. Paysend now has more than 6 million users all over the world.

When sending money to a bank account, there are no transfer costs. Transferring directly to a recipient's Mastercard using a recipient's name and card number costs only Euro 1.5, GBP 1, or $2, depending on the country you're transferring from.

Regardless of the amount sent, the cost remains unchanged. As a result, unlike other companies that charge a percentage of the transfer amount, the fees are always low, flat, and transparent.

Before making any transfer, check the rate, the transfer fee, and the amount owed to you.

Paysend transfers take an average of 15 seconds to complete, although some might take up to 3 days. Paysend is one of the most efficient money transfer providers.

Revolut  

You may send money in more than 30 currencies to more than 100 countries with Revolut, a smart financial app. Revolut now has more than 18 million customers around the world.

You may keep 30 different currencies in your Revolut account for free, which is beneficial for international payments.

For foreign currency exchange, Revolut uses authentic exchange rates, with no markup on the real prices for most currencies. However, there may be a little surcharge on weekends. Schedule your transfer during the weekdays if you don't want to pay the markup.

It's free to send money to other Revolut users across the world or to non-Revolut accounts in Europe's SEPA (Single Euro Payments Area) zone.

For payments sent outside the SEPA region, there are fees for international transfers to non-Revolut recipients.

Every month, you can send up to 1,000 GBP without paying any exchange fees. If you have a Standard account, you may be charged a 0.5 percent fee if you go above the limit. To enjoy unlimited transfers and no foreign exchange fees, upgrade to Premium or Metal.

Charges for card transfers are calculated in real-time online or on the Revolut app prior to payment. The amount being transmitted and the destination determine the charge.

The transfer might take anything from a few seconds to two working days, depending on the currency being sent and the recipient country.

Compare Your Money Transfer Options

There are many ways to send money abroad. Since there are several options available to you, it is not one size fits all. Meaning there are specific options depending on your transfer requirements. 

Which money transfer option is appropriate for you is determined by a number of criteria. When deciding on the best option for international money transfer online, factors such as transfer speed, transfer fees, payment, and delivery methods, and the senders' and receivers' geographic locations must all be taken into account.

The best international money transfer option is one that offers the best balance of the best exchange rate, the lowest costs, and the fastest transfer time. You can save money and time by selecting the right money transfer service.

CompareRemit is a popular online marketplace for remittance companies. By visiting the CompareRemit website or using the CompareRemit App, you can compare leading money transfer businesses side by side in terms of exchange rates, fees, speed, the amount receivable, promotional offers, and more for a chosen currency pair (available on both iOS and Android systems). Rate notifications can be set up to tell you when your preferred exchange rate becomes available for your transfer.

How To Send Money Online Overseas?

Once you have decided which service to use to send money to your specific corridor, 

  • Register an account with that provider
  • Add personal details 
  • Also, add recipient details (account details-IBAN or SWIFT code, transfer amount, etc.)
  • Confirm the details
  • Press Send
  • Leave the rest to the service provider
  • Track your transfer

Bottom Line

With a plethora of transfer options at your disposal, you may be able to find more transfer options with attractive exchange rates, lower fees, and higher speed depending on your needs. Comparing your options before making a final decision is the best approach to sending money abroad. While banks may appear to be the most convenient way to send money abroad, money transfer specialists offer better exchange rates, low and transparent costs, and easier and faster money transfer processes.

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