Digital money transfer providers can often beat the rates offered by banks. Using an online money transfer service, instead of a bank, to transfer money to Canada will cut down on fees and give senders access to stronger exchange rates and faster turnaround times.
Is the border between the US and Canada closed?
Yes. The US and Canadian governments agreed to close the border to all non-essential travel as of March 21. Canadian Prime Minister Justin Trudeau has announced that both countries have agreed to extend the border closure until July 21, 2020.
This notice is current as of May 3, 2020 and will be updated as the government releases new information.
Send money to Canada with XE
Whatever amount you transfer, XE will not charge you a fee for using their service.
Sending money to Canada online is easy with these 4 steps:
Sign up for a free account. Pick a provider and sign up for a free online account by providing contact information, proof of ID and a preferred payment method.
Provide transfer details. Submit the recipient’s contact information, and pick a delivery method. If money is being transferred to a bank, the sender will need to provide the recipient’s Canadian bank account details.
Confirm transfer details. Senders should carefully double-check the payment method, expected fees and destination.
Save the receipt. A confirmation number will be provided to track the progress of the transfer. Senders should provide the recipient with this number to receive the funds. Some money transfer providers send a text or email when the transfer is complete.
What’s the best way to send money to Canada?
Online money transfer providers typically offer the strongest exchange rates and lowest fees on money transfers to Canada. Some offer transfers straight to Canadian bank accounts, while others allow the money to be picked up in Canadian dollars in person. Banks, PayPal and other options are available but come with high fees, weak rates and longer turnaround times.
Digital money transfer services
Companies like OFX and CurrencyTransfer specialize in foreign currencies, making them some of the most cost-effective transfers. Most offer transfers directly to the recipient’s Canadian bank account, often in as little as a day or two.
Services like MoneyGram allow senders to transfer cash for pickup at a local branch in Canada— often in 15 minutes. While it’s a fast way to send money, senders may also be faced with weak exchange rates and high fees. Digital services like WorldRemit or XE may be able to provide a better deal.
Canadian dollars are carried by many bank, especially if senders are from the US. Although local banks can convert foreign currency into Canadian dollars, it may be done at the cost of high fees and wide margins on the exchange rate compared to digital and other options.
Let’s crunch the numbers: Sending money to Canada
From the US: Let’s say you live in the US and want to send $2,000 USD to a family member in Canada. Here’s what you might face as far as fees and exchange rates on May 3, 2020.
Digital money transfer service
$25 + additional correspondent bank fees
1 USD = 1.363 CAD
1 USD = 1.365 CAD
1 USD = 1.297 CAD
Slowest and most expensive
The bank option ends up being both the slowest and gets the smallest amount of money to your recipient. If you go with the digital money transfer service, your recipient ends up with CAD 95 more than the bank offers. If speed is crucial, a cash transfer can typically have your transfer to Canada in as little as 15 minutes for just a slightly higher fee.
From the UK: Say you lived in the UK. Sending £2,000 to Canada might break down as follows (the fees and exchange rates are based on real figures as of May 3, 2020):
Digital money transfer service
£25 + additional correspondent bank fees
1 GBP = 1.6498 CAD
1 GBP = 1.6295 CAD
1 GBP = 1.5910 CAD
Slowest and most expensive
Once again, the bank option ends up being both the slowest and gets the smallest amount of money to your recipient, while the cash transfer is the quickest. Sending through the digital money transfer service would result in your recipient getting CAD 157 more than had you sent through the bank.
How to get the most out of your money transfer to Canada
Weigh costs and fees against convenience, and learn how to compare money transfer providers that send to Canada to meet your needs:
Exchange rates. Exchange rates fluctuates daily, so using a service that allows you to lock-in exchange prices may help you save money down the line if exchange rates take a turn for the worse in the future.
Transfer fees. Transferring money overseas nearly always requires fees, but they might be hidden in the exchange rate. When sending large amounts, it may be cheaper to pay a flat fee to secure a stronger exchange rate.
Transfer limits. Transfer minimums and maximums vary by company, and different amounts can attract higher or lower fees. It’s wise to shop around for the best deal on the amount of Canadian dollars being transferred.
Turnaround. Transferring money through a local bank can take a business week or longer. Many digital specialists can offer instant transfers to Canada, which is important for senders looking to send money quickly.
Maximum limits. Sending more money when exchange rates are favourable can result in long-term savings. Choosing a provider that doesn’t impose transfer limits can be helpful for large transfers to Canada.
Transfer methods. Whether money is being sent to a Canadian bank account or for cash pickup at a local agent, companies don’t necessarily offer the same transfer methods. Senders will need to narrow down their options to a company that offers their preferred delivery method.
Emergency cash transfer to Canada
When it’s more important to get money to Canada quickly, senders should look for money transfer companies that support cash pickup in minutes. Fast pickup options can usually be paid for by debit or credit, but fees may be higher than other methods.
How to send money to Canada without a bank account
Cash transfer services can help senders who are unbanked or marginally banked. Senders who don’t have a bank account should look for a local company that supports storefronts for cash payments. These services include agent locations in other countries that allow recipients to pick up cash without a bank account.
Canada’s exchange rates explained
The exchange rate determines how much one country’s currency is worth in another country’s currency. When a country’s currency is strong, it yields more money when exchanging it in a country with a weaker currency. Canada’s exchange rate often fluctuates when compared to foreign currencies, so senders should expect exchange rates today to be different to tomorrow’s rates. Factors that influence the exchange rate include interest rates, economic stability and inflation.
Documents needed for sending to and receiving money in Canada
To send money to Canada, senders will need government-issued ID and other documents, while documents needed to pick up money in Canada may differ by company.
Documents to send money to Canada
Documentation and details needed to send money to Canada may include:
Identification. Most services require a driver’s license, passport or other government-issued ID. Some services allow transfers without any ID, but some form of Social Security identification number may be required.
Payment method. Services may accept credit or debit cards, cash, bank accounts or personal cheques.
Recipient information. Senders must provide the recipient’s name as it appears on their ID, along with their phone number and, for transfers to Canadian bank accounts, account information consisting of a transit number, institutional (bank) number and an account number.
Documents to receive money in Canada
To pick up money in person, documentation can include:
Transfer number. The person sending you money can forward the transfer’s confirmation details — called a PIN, a MTCN (Money Transfer Control Number), a reference number or a tracking number, depending on the company.
Government-issued ID. A Canadian Passport, Canadian Driver’s License, Canadian-Indian Status Card or a similar government-issued ID is typically required to pick up cash.
Amount sent. You may need to know how much was sent, usually within 10% of the total.
Sender’s information. Take along your sender’s full name, the sending country and their address, if known.
What to watch out for
Typically, Canada imposes no restrictions on remittances to the country through banks and money transfer companies. You also aren’t taxed simply for receiving a money transfer, although the purpose of the money (i.e. an inheritance, capital gains from the sale of an asset etc.) may trigger certain tax rules. Speak to a tax professional to find out exactly what rules apply to your situation.
That being said, banks and companies are required to comply with banking and recording standards that help them avoid the appearance of money laundering. These standards require customers to submit valid ID, log high-amount transfers and submit precise recipient information. Read our guide to Canadian remittance tax guidelines to learn more.
Sending hard-earned money to Canada shouldn’t cost a fortune. Senders should compare transfer companies that specialize in foreign transactions to get the strongest rates, lowest fees and most flexible delivery options. For transfers from Canada to other countries, use our country-specific guides to find out which providers offer the best deal for your needs.
Zak Killermann is a staff writer at Finder specializing in money transfers. He has ghostwritten hundreds of FinTech articles over the years and found his love for publication at St. Cloud State University. Zak has been traveling internationally for nearly half his life and — after getting burned once by an over-the-counter money exchange — vowed to never settle for anything short of the mid-market rate.
Review: Ria money transferWith 240,000+ locations in 130 countries, Ria is the third-largest provider of international money transfers in the world. It offers great exchange rates, minimal fees and fast, secure transactions when you need to send funds overseas.
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