Self-quarantining and social distancing are changing the way we send money across borders. Here’s everything you need to know about what impacts the coronavirus might have on getting money to your loved ones.
The impact of the coronavirus on Canada
Many provinces are closing banks, currency agent branches and more to try and stem the spread of the coronavirus. To learn more about how to deal with these closures, how to self-quarantine yourself and more, read our detailed guide on the coronavirus in Canada.
As Canada reacts to the coronavirus pandemic, the remittance industry is being affected by the following:
Closures. Non-essential businesses like bars and theaters are closing in many Canadian provinces. Although banks and money transfer agent locations may remain open, using online transfer options will help you maintain your self-imposed quarantine.
Exchange rate volatility. We haven’t seen this kind of volatility in decades. Fluctuating exchange rates could make a difference of several hundred dollars to what arrives in your receiver’s pockets, so it’s important to pay close attention to the live rate – things could change quickly. To keep on top of the two global currencies you’re comparing, check out our guide on currency pairs.
Customer service availability. Many companies will be reducing the availability of their customer service agents, both online and in call centers. PayPal Canada, for instance, recently alerted customers that “Due to coronavirus (COVID-19) safety precautions, we currently have limited customer service staffing so wait times may be longer.” So if you happen to make a mistake in your online transaction and need to reach someone on the phone to fix it immediately, or need a human voice to help you through the online steps, don’t expect the same support you’d normally receive.
Sending $1,000 from Canada to Europe during the coronavirus pandemic
Let’s say you need to send $1,000 to friends or family members that are stuck quarantined abroad. Here is what you might face in fees and physical contact risks as of March 19, 2020.
Online money transfer service
Bank wire transfer
$30 + additional correspondent bank fees
1 CAD = 0.6385 EUR
1 CAD = 0.5942 EUR
1 CAD = 0.6189 EUR
Within minutes, or 1-2 days
Best value – no physical contact
Fastest – physical contact
Slowest and most expensive – maybe physical contact
Here, the bank wire transfer ends up being the slowest and results in the recipient getting less money than if you use an online money transfer service, but you could possibly be able to send a bank wire transfer entirely online. If you go with the digital money transfer service, your recipient ends up with around EUR€41 more than with a cash transfer and around EUR€30 more than with a bank transfer. If speed is crucial, a cash transfer can typically have your transfer to Europe in as little as several minutes; just be aware that the recipient will need to pick it up in person with valid ID.
Be sure to look at the margin on the exchange rate as well as the fees to figure out if you’re getting a good deal. We’ve gone into more detail on this in our full guide on sending money internationally.
Online money transfer services
The table below shows a round-up of some of the most popular online services that can help you send money to where it needs to go.
Disclaimer: Exchange rates change often. Confirm the total cost with the provider before transferring money.
What if my recipient doesn’t have a bank account?
Depending on the provider, you can still make an online transfer to a recipient who doesn’t have a bank account.
Emergency cash transfers
If you need to get money abroad now instead of later, there are ways to speed it up. Many online money transfer services offer delivery in as fast as a few minutes. Learn more about the limits and fees for emergency transfers.
Many emergency transfer options require your recipient to pick the money up in person, as delivering to a bank account often takes more time. Double-check how the transfer will be received, especially if you are sending to a country that is recommending self-quarantine or social distancing practices during the coronavirus pandemic.
According to a recent report in Reuters, handling banknotes doesn’t pose any added risk of contracting the coronavirus. Your recipient shouldn’t fear collecting cash so long as they take the usual precautions and wash their hands frequently.
How to send money to someone without a bank account
Unfortunately, options without physical contact are limited when it comes to sending money to someone without a bank account.
If you or your recipient doesn’t have a bank account, look for a local company that supports storefronts for cash payments. These services include agent locations in other countries that allow your recipient to pick up cash without a bank account.
Call the agent location before sending your transfer, if possible, to make sure they will be open when your recipient goes to pick up cash.
How do fluctuating exchange rates affect my international transfer?
No one has a crystal ball here, so it’s important to keep an eye on exchange rates regularly. That will help you gauge when it’s a good time for you to send money abroad. Online transfers can often lock in a rate for you, which, with roller-coaster markets, could potentially help you get more bang for your buck.
What other ways can I send money around the world?
Aside from traditional money transfers and bank transfers, there are other alternatives you can use to help move money during the coronavirus pandemic.
International digital banking. Although it may take some time to set up, creating an international digital banking account can help reduce the costs of moving money to loved ones abroad. Read our short guide on international bank accounts to get started.
E-wallets. Electronic wallets are a great way to manage your funds digitally. PayPal is one example, but so are services like Coinbase and Apple Pay. By relying entirely on digital services, you won’t have to touch cash or interact physically with anyone. Some stores even accept e-wallets for payment, making your transaction entirely contactless.
Cryptocurrencies. If you and the recipient are both computer savvy, cryptocurrency can be a very fast and cheap way of sending money internationally, in a way that doesn’t require either of you to have a bank account or leave your homes. If you’re interested, our comprehensive guide over at Crypto Finder can get you started.
Sending money internationally may be more important for you now than ever, especially if you have loved ones quarantined abroad. Although it’s become trickier to send money overseas, there are still plenty of online options that can help you get your money where it needs to go.
Pay extra attention to movements in the exchange rate. If you’re concerned about further drops in the value of the Canadian dollar, consider ways to lock in a competitive rate like securing a forward contract, booking a market order or keeping funds in a foreign currency bank account. It pays to compare a number of money transfer services to make sure they meet your needs and can give you the best deal.
Zak Killermann is a writer at Finder. He’s ghostwritten hundreds of articles on fintech, finding his love for publication at St. Cloud State University. Traveling internationally for nearly half his life — and getting burned once by an OTC money exchange — Zak's vowed not to settle for anything short of the mid-market rate again.
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