A Complete Guide to Sending Money to Mexico 2022 | CompareRemit
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How to Send Money to Mexico 2022: A Complete Guide

Updated on October 24, 2022 04:07 pm
sending money via smartphone

Mexico is the third-largest recipient of remittances - the money that migrants send to their families and loved ones back home, only after India and China. Since the U.S. has the biggest population of Mexican immigrants, more than 90% of remittances to Mexico come from there.

Sending money to Mexico can be done primarily in two ways. The first is to use your bank (which is not recommended). The second option is to use an international money transfer service.

Money transfer companies offer different ways to transfer money to send money to Mexico. For example, Western Union and MoneyGram offer multiple pay-out options: 

  • Bank account transfer,
  • Cash-based transfer via agent locations worldwide, and
  •  Online transfer through their money transfer app.

While others are completely online, like Wise, which lets consumers send money overseas online using either their website or mobile app.

Bank Transfers from the US to Mexico

It may seem like a safer option to transfer funds from your bank account to a bank account in Mexico by using your bank—whether it be Well Fargo, Bank of America, Citibank, Capital One, or any other. However, it is extremely expensive. 

For instance, using Wells Fargo to transfer money from the US to Mexico can cost up to 10% more than using an authorized online money transfer provider. This is why banks are not the best way to send money to Mexico.

Furthermore, transfers typically take longer (between 2 and 5 business days). This is because bank transfers use SWIFT, which is a lengthy process as there can be more than 2 or 3 intermediary banks that participate in making the transfer possible.

SWIFT, which stands for Society for Worldwide Interbank Financial Telecommunication, is a messaging system that allows banks worldwide to connect safely and swiftly to make cross-border payments. About 11,000 member banks in 200 countries and territories are part of the SWIFT network.

What is the Cheapest Way to Send Money to Mexico?

The cheapest way to send money to Mexico is through a money transfer specialist. Compared to traditional banks, they provide rates, fees, and commissions that are far more competitive.

Moreover, because they are typically the fastest and most user-friendly choices available to send money to Mexico from the U.S., several top online money transfer companies offer USD to MXN transfers.

How To Send Money Online to Mexico?

An online money transfer is today's version of wiring money, but considerably less expensive and simpler! 

Online money transfer services let you send money with a few simple clicks from your tablet, laptop, or mobile device. There is no need to visit a bank or a physical place for money transfers. In comparison to banks, they provide far better USD to MXN exchange rates as well as transparent, affordable costs.

In short, you will get more pesos for your dollars by switching to one of the online money transfer companies, such as Wise, Skrill, Instarem, or WorldRemit. 

These companies are also regulated by concerned authorities in the country they operate in. Financial regulatory agencies, including the Financial Crimes Enforcement Network (FinCEN), the Financial Conduct Authority (FCA), the Australian Transaction Reports and Analysis Centre (AUSTRAC), and other pertinent agencies, are in charge of overseeing these companies.

Sending Money to Mexico Using Online Money Transfer Companies

  • Choose a money transfer service provider based on delivery options, cost, and speed.
  • Create an account on their website or mobile app.
  • Provide the necessary information.
  • Give information about your recipient in Mexico.
  • Verify information and choose a payment method.
  • Tap "Send"!

How Does Money Transfer Work?

The three key participants in a remittance transfer are:

  • the sender, 
  • the recipient, and 
  • the remittance service provider. 

For the transaction to be successful, there must be two remittance service providers—one in the sending country and one in the receiving country.

The provider in the receiving country need not be the same as the one in the sending country. Banks often take part in the money transfer process, either receiving the money in the bank account or funding the transfer. 

The service provider will apply the exchange rates they offer while converting currencies and charge a fee. Every service provider has different transfer fees and exchange rates. To make a profit, most money transfer service providers offer a marked-up rate (hidden exchange rate margin) higher than the actual exchange rates found on Google and Reuters.

The recipient may select from a variety of delivery options, depending on the service provider, such as direct bank account transfer or in-person pickup at a nearby agent location.

The sender has several payment choices for the transfer, including cash, debit cards, credit cards, and bank transfers. There are additional fees for credit card payments.

The entire process can take up to 5 business days or longer, depending on several factors.

International Money Transfer Fees

The transfer fees depend on various factors:

  • Pay-in options include cash, bank transfer, credit card, and more.
  • Amount sent from the US to Mexico (The cheapest service provider may not be the same for a transfer of $500 and a transfer of $5,000.)
  • Transfer speed: Instant transfer or slower transfer (wait for a few days.)
  • Pay-out options: Transfer to a bank account or in cash.

International Money Transfer Tips

  • Exchange Rates

The exchange rate is important because it affects how much money your recipient will receive.

Most transfer companies won't reveal the actual exchange rate (the one you see on Google search). They provide a marked-up rate that adds 3–5% to the real rate.

 When choosing your transfer provider, check the foreign currency conversion rate while comparing the exchange rates offered by different international money transfer services.

If you want to know if the exchange rate that has been provided to you is reasonable, look up the actual exchange rate online or use a currency conversion tool.

  • Transfer Costs

As mentioned earlier, the cost of an international money transfer varies according to the payment type, transfer amount, transfer speed, provider, delivery mode, and destination country.

Beware of hidden costs. Use the price estimator found on the websites of money transfer companies to acquire a better estimate of the cost. Select transfer businesses with upfront fees and fair exchange rates.

Additionally, although the money arrives more slowly, paying with a debit card or bank account is less expensive than doing so with a credit card. 

Even though you can use your credit card to make the payment, and the money will reach the recipient more quickly, there will be a higher upfront cost, interest, and cash advance fees. It is a good idea to choose the less expensive choice if you are not in a rush.

Search for discounts and special deals, particularly for first-time senders, to waive the transfer fees and reduce the transfer cost.

  • Transfer Speed

Faster delivery will cost more, so plan accordingly. Payments made using a credit card have higher fees but are processed more quickly than payments made with a bank account or debit card.

Cash transfers are the quickest option; however, they often cost more.

  • Customer Reviews 

Online customer reviews of money transfer businesses can provide useful information. Check out the customer reviews of the specific money transfer provider to see what kind of service people are receiving from them.

  • Compare Your Options    

To find the cheapest or fastest money transfer service for you, use CompareRemit's online comparison tool to compare various money transfer services. Examine the exchange rate when comparing your fastest options to ensure you're not receiving a bad deal.

Simply enter your desired amount, sending and receiving countries, and currency pairs to evaluate your options side by side for exchange rates, costs, transfer speed, delivery method, and amount receivable.

Listed below are some of the popular money transfer services to send money to Mexico

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.

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

There are no markups on currency rates while using Wise. The mid-market exchange rates offered by Wise are identical to those on Google. As a result, your beneficiary gets a bigger payment. From 59 countries to over 80 countries, you may send money online with reasonable costs and accurate exchange rates.

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

The method you use to fund your transfers will have an impact on your overall expenses. In addition to bank accounts and credit cards, Wise also takes payments via SWIFT and PISP.

The transfer speed varies depending on the currency pair and payment type. The quick transfer is finished in only a few minutes. It can take up to two days to make a bank deposit. The SWIFT network may require 2 to 5 business days to complete a transfer.

Skrill

Skrill is an online service for sending money that works in over 180 countries and 40 different currencies to bank accounts, mobile wallets, email addresses, and phone numbers (all options may not be available in all countries). Additionally, you can purchase and sell cryptocurrencies using them.

On the website or through the Skrill app, you can register for an account.

Skrill generates revenue by charging up to 4.99% of the total amount of your payment as a markup on exchange rates. A 2.99% fee applies when sending money from Skrill to Skrill.

It takes as little as two hours to complete a manual bank transfer. However, depending on the payment method and how the money is transferred, it may take up to 3-5 business days for transfers to arrive.

Instarem

Through its global network of more than 8000 institutions, internet remittance service provider Instarem offers the ability to send money to over 55 countries.

Real-time currency conversion rates are also provided by Instarem. There are no additional fees.

Instarem fees could vary from 0.25 percent to 1 percent for each transaction. Before sending money, the transfer fees are displayed.

Instarem accepts a variety of payment methods, including debit cards, credit cards, wire transfers, and bank transfers. Depending on the country from which you are sending money, several payment methods might be accepted. To register, use the Instarem app or online.

Remitly

Remitly is a worldwide money transfer service that allows users to send money from 21 countries to more than 100 recipient countries. It primarily assists immigrants who are looking for inexpensive, practical, and quick money transfer services. They have a website and an app where you may send money.

They accept a variety of payment options, such as home delivery, cash collections, mobile money, and bank deposits. The methods and speeds available for delivery depend on the nation to which you are sending money.

There are two different transfer speeds on Remitly:

  • Express: The quickest possible delivery of money. Payment must be made using a debit or credit card, and there are higher expenses involved. Credit card payments are subject to additional fees.
  • Economy: The delivery of money takes 3 to 5 business days. It is funded straight from your bank account and has lower fees.

The total transfer fees are affected by the amount being transferred, the speed of delivery, the method used to pay the transfer, the country to which it is being sent, and the method used to receive the funds.

Bottomline

The best option for you will depend on several crucial aspects, including speed, cost, the method used for payment in and payment out, the locations of the sender and recipient, etc.

The good news is that you may avoid sending money through conventional banks, which frequently provide inferior exchange rates, charge greater fees, and delay the transfer of your funds to the destination.

Make sure to compare the exchange rate when weighing your options to make sure you're not receiving a bad deal.

To send money to Mexico today, use CompareRemit to compare top remittance partners to find the best rates, lowest fees, and more!

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