We show you the options you have to send money to Iran.
For many years there were sanctions on the nation of Iran that prohibited many types of financial transactions with Canada. This prevented many different forms of transaction, like international money transfers, from being sent between the two countries.
Sanctions are imposed for a variety of political and economic reasons. For this reason, Iranians who have relocated to Canada must find alternative methods of getting money to their families back home.
In 2016, sanctions were lifted by Canada in order to work on the relationship between the two countries. Although some sanctions have been lifted, there is still much progress to be made between the two countries and sending money between the two can still prove to be a difficult task.
Instead, people tend to use bitcoin for currency transfers overseas to countries like Iran.
- How do I buy Bitcoin? There are special exchanges, like the 247 Exchange, where participants can buy and sell bitcoin. You can buy the cryptocurrency in a variety of ways, including prepaid cards, brokers, agents and by directly transferring funds to the exchange.
- Where do I store them? You’ll need to create a wallet that acts similar to a bank account. You can have a software wallet stored on the hard drive of your computer, or use a web-based service. Remember to back up your computer regularly in case anything happens to your hard drive.
- What services can I use to transfer Bitcoin to Iran? You can use websites like Coinava.
Case study - Banks vs money transfer companies
Abtin, an Iranian citizen, has been living and working in Canada for four months. Wanting to help with the cost-of-living for his mother in Iran, Abtin begins to look for ways to send some of his Canadian earnings back home.
What he immediately sees is that there are not many options with his Canadian bank, nor with popular specialist money transfer providers such as Western Union. He does, however, find a service located in the UK. He could send the money to a friend there and they could then send it to Iran. This company, Sarrafi, does not publish any information about the rates and fees until the transfer has been requested.
Another interesting option he discovered was to send bitcoin tokens. This is a digital currency that is accepted for use in Iran. You can buy bitcoin in Canada and they can then be sent to family in Iran and converted into Iranian Rial. In December 2017, approximately $19,557 Canadian dollars bought one bitcoin in Canada. Once sent to Iran, that one bitcoin can be converted to 536,456,934.20 Rial. With the rapid rise in prices of bitcoin in the last few years, purchasing one bitcoin alone is obviously a lot of money. Fortunately, you can purchase smaller amounts of bitcoin.
At that same time, a conversion of CAD$19,557 without having to use bitcoin would yield IRR536,436,900.96. Although sending money with bitcoin yields slightly higher returns, there are fees involved in the buying and selling process. There are also fees involved with using a money transfer service or a bank to send money overseas, so either way you choose to send the money will result in around the same amount reaching Iran, give or take a few dollars.
How to compare transfer companies when transferring money to Iran
Not being able to conduct a direct transfer to Iran results in additional fees and losses in exchanging currency. There are also other features that you should be considering when trying to transfer money to Iran from Canada:
- Exchange rate. This may not always be evident immediately, but you should not make a payment until the company you are using shows you what the exchange rate will be.
- Pick up methods. With bitcoin, Abtid found that his family could convert the coins to cash and have the Rial deposited into their bank account.
- Reputation. You should only be looking at financial services that have an established reputation. With this type of transaction, it may be easier for a company to take advantage of you and your money.
Tips for picking up cash in Iran
It is recommended by the Canadian Government that you exercise a high degree of caution when travelling to Iran. If you do visit Iran and are robbed or lose your purse, you will find it very difficult to obtain any cash to help you finish out your stay. Your credit card will likely not work in Iran, nor will traveller’s cheques. Canada closed its embassy in the capital city of Tehran a few years ago, so it can even be difficult to receive help from the government. The Canadian Embassy in Ankara, Turkey, is responsible for guiding and providing assistance to Canadians in Iran.
How to send money to Iran
Due to difficult relationships between the Canadian and Iranian governments, a secondary institution or currency will have to be used in order to send money to Iran. This could be with bitcoin or by finding a transfer company outside of Canada, like the one in the UK, that will send the money for you.
Unfortunately getting money back home to family, friends or business contacts/suppliers in Iran can be difficult. If you are getting ready to make a move overseas, it may be wise to speak with a representative of your Iranian bank to help you come up with a viable and cost effective solution.