The financial world is changing rapidly. This implies there are excellent chances to send money across borders in more convenient, easy, and less expensive ways. The days of expensive remittance services or a high street bank are the only options that are long gone.
You may now select the finest method to transfer money across borders based on your needs. However, there are dangers with this flexibility, and a poor decision could cost you a lot of money. We’ll look at all of your options for sending money overseas and help you choose the best solution.
Reasons For Transferring Money Between Countries
The world has gotten smaller as globalization, low-cost travel, and remote work have advanced. This implies that you may require money in a different nation or currency for a variety of reasons such as:
- Converting your money so you may spend it while traveling or living abroad.
- Sending cash to relatives or friends in another nation.
- A purchase which may include anything such as a house or book that may require forex payment.
- Mortgage payments for a second home in another country.
- Investing in a company, property, or other assets outside of the United States.
- Spending money on services. It might be overseas study expenses or a wedding in a far-off location.
- Getting things done. Hiring a freelance or foreign firm to do the job.
Risks When Transferring Money Between Countries
There are several banking and non-banking institutions that provide various ways to transfer money abroad securely. Before you begin, though, it’s a good idea to learn about the potential hazards.
- Exchange Rates: When you get a quote, most servicers will lock in your exchange rate. It’s ideal and cheapest to wire money in the receiving bank’s currency to avoid extra fees if possible. It is critical to make sure you understand all of the charges connected with your transfer. Occasionally, a firm will promise low transfer costs only to increase the exchange rate.
- Scammers: If something is given to you for free, it should raise a red flag. There are text messages, websites, email, and direct phone calls scams all the time. Every day, the scammers become more devious.
- Hidden Fees: It is important for you to know everything ahead of time. The mid-market rate is often quoted by servicers. They further markup the exchange rate above that. They may also charge transfer and commission costs in addition to this. Some people like to start with a free transfer and then pile on the high monthly costs. Others offer a low-cost service with unfavorable exchange rates.
- Limits: Some of the services respond better to bigger transfers, while others prefer smaller amounts. Know your limits ahead of time, especially if you know you’ll be making frequent transfers.
- Delays: Even the most established firms will experience delays from time to time. These are not always the servicer’s fault, but if they do fail to compensate you for an error, it’s in their best interests to have a policy in place. Inquire about this up front.
Details Required When Transferring Money Between Countries
You can send money abroad by using a bank to transfer funds, but it isn’t always the most convenient method. If you are wiring money via a bank, you’ll need to have all of your recipient’s banking information on hand:
- Address and name of the bank to which you’re sending the cash.
- Address, full name, number and name of account, or IBAN of the recipient.
- Recipient’s bank BIC/SWIFT code. These are the worldwide bank identification codes, which are unique to each financial institution.
- A reason for the transfer.
The 8 Best Way To Transfer Money Between Countries
1) Venmo
When you connect a bank account, prepaid debit card, or debit card to your account, sending and receiving money is free. The cost of using a credit card is 3% of the transaction. You may send up to $4,999.99 each week for peer-to-peer transactions with just a few clicks on Venmo.
Your Venmo balance updates right after you receive the money, but cashing out to a bank account takes 1 to 3 business days. You may also send funds to a debit card, which takes approximately 30 minutes and costs a fee of 1.5%.
Reasons for picking it:
- This application is highly rated on the iOS and Android platforms.
- Socially engaging, easy and free money transfers.
2) Zelle
You may send and receive funds in a matter of minutes between bank accounts at various banks using Zelle. To receive and fund payments, you’ll require a bank account in the United States. Zelle does not charge any fees, but any of its associated banks may choose to do so.
Some of the biggest banks impose a daily money transfer maximum of $2,000 or $2,500. Zelle is not designed for selling or buying items, and you are not protected if anything goes wrong. You may also find that you’re out of luck if you send funds to the incorrect individual or transfer too much money. Zelle does not cover you if someone steals your Zelle account or password and uses it to send money.
Reasons for picking it:
- The average delivery time is approximately minutes.
- Over 100 million people are currently connected to the network by connecting over 1,000 financial companies.
3) PayPal
When you fund your account with a PayPal balance or bank account in the United States, PayPal provides free transfers. You’ll pay a fee if you use your credit card to make a purchase: 2.9% of the amount paid out in addition to 30 cents. The maximum amount you can send on a single transaction varies from $10,000 to $60,000 depending on your currency.
Money transfers, on the other hand, can take anything from 1 to 4 days in total, depending on when they are completed. You can as well pay with a linked debit card for an immediate transfer. You may receive or send money on the website or mobile app for Android and iOS phones where you may establish your own payment link that friends and family may use to contribute to your account.
Reasons for picking it:
- Highest transfer maximum.
- There are more than 400 million active accounts in the world today.
4) OFX
OFX does not charge any fees, regardless of how much you send. Its online service, which includes both an extensive website and mobile site, lets you make a transfer at current exchange rates or target future rates that are, your money will flow once your exchange rate has been met and markups are minimal.
OFX offers a minimum deposit of $1,000 and has no maximum. The delivery period normally takes several working days.
Reason for picking it:
- There are no outbound fees.
5) Xoom
Xoom specializes in lightning-fast transfers to over 160 countries, making it an excellent option for sending money to friends and family. You may send up to $100,000 if you wish; however, the longer you wait and the more personal information you must submit (such as Social Security number or a passport and a bank statement), the higher the amount.
You may send cash via credit card, bank account, debit card, or the payment methods in your PayPal account, and most payments are completed in a few minutes. Xoom’s pricing is where it falls behind its competitors. Xoom earns money through exchange rates, but it provides better discounts for sending larger amounts to certain countries. Transfers between bank accounts are generally not free. Overall, debit and credit card fees may be greater.
Reason for picking it:
- For some countries, however, you may transfer your money to a bank account in another country within minutes.
6) MoneyGram
MoneyGram is a global money transfer and payment company that maintains more than 200 locations around the world. Cash pickup at one location is delivered in minutes by cash pick-up, which is comparable to MoneyGram’s main competitor, which is Western Union.
Exchanges to bank accounts in various nations take hours or a single day, while transfers from other providers might require multiple business days. You’ll have to pay costs. The fees for sending $200 to $1,000 dollars vary from approximately $5 to $12 throughout the countries. MoneyGram has a 0.60 percent fee on exchange rates.
Reason for picking it:
- For quick transfers to bank accounts or cash for collection anywhere in the world, choose MoneyGram.
7) Western Union
Western Union is the world’s largest money transfer business, with a wide selection of transfer methods. You may send money from the Western Union mobile app or its website, and it’s also possible to use a credit card, bank account, debit card, or send cash from a nearby agent location.
Transfers are usually expensive, and only a few services provide same-day or next-day delivery. It might take several business days for a transfer to complete once you’ve made the transaction.
Reasons for picking it:
- Its worldwide network of locations is extensive.
- There are several options for receiving and sending receiving money.
8) Wise
On its mobile and online money transfer platform, Wise strikes a balance between simplicity and cost. Signing up with your Google, Apple, or Facebook account rather than a site-specific login provides you with a more consistent experience.
Wise transfers money to over 80 countries without adding an exchange rate markup, however, they do charge an exchange rate fee, which helps to make the transaction happen. In most situations, you will pay two charges: a flat dollar amount, which often goes up with the amount you send, and an exchange fee, which is frequently less than 1% of what you send.
Reasons for picking it:
- There is no markup in the foreign exchange rate.
- From sign-up to delivery, you will have a user-friendly online experience.
Learn More: The 5 Best Way To Wire Transfer Money Internationally
Glossary Of Terms For Transferring Money Between Countries
- Forex Spreads: This is the difference between the buying (ask) and selling (bid) commissions at a currency exchange. The wider the spread, the higher your loss will be on a transaction.
- Mid-market Rate: The middle point where the buyer and seller rates meet.
- Spot Rates: This is the actual exchange rate that was offered to you.
- IBAN/SWIFT: IBAN (International Bank Account Number) and SWIFT (Society for Worldwide Interbank Financial Telecommunication). It is a worldwide unique ID number for every bank account.
- FX: This is the abbreviation of Foreign Exchange.
- Mid-market Rate: The rate at which big banks move funds between one another.
- Wire Transfer: A method of transferring money from one place to another through the use of technology.
Learn More: The Fastest Way To Transfer Money Between Banks
Bottom Line
It’s been simple to send cash overseas for a long time. The growth of alternatives has made the process more difficult. However, it also implies that you have a lot of options open to you. The best solution should save you money, satisfy your demands, and provide you with peace of mind.
