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Transfer fee and the exchange rate are the two most common charges when you need to send money overseas. Save on these fees by comparing banks and transfer services to find which offers the lowest fees and still meets your needs.
Banks and independent money transfer services charge fees per transfer. These fees can be a flat transfer fee — for example, $25 per transfer — or a percentage of the total amount you’re sending.
Depending on your bank or money transfer service, you could pay:
| Fee | Description | |
|---|---|---|
| A | Amendment | Fee for changing the details of your international money transfer. |
| B | Bank-to-bank | A fee for transferring money to a competing bank, much like an ATM fee. |
| C | Cancellation | Charged if you decide to cancel your transfer — the receiving bank can also charge a cancellation fee. |
| D | Disbursement | Sometime call outgoing fees. The recipient’s bank may charge a fee to receive an international money transfer. You can pay this fee upfront to make sure your loved one can get the full amount you intended to send. |
| I | Investigation | This fee is charged if you inquire on the status of the transfer. |
| I | International | For sending or receiving money from an overseas bank account. |
| M | Margin | This is applied to the exchange rate and is often a hidden cost. Cross check the interbank rate against exchange rates published on the international payment service provider’s site to find out the margin. |
| O | Online | Online banks often charge this fee for international money transfers. |
| P | Payment method | A fee based on how you’re paying for the transfer. For instance, some banks charge more if you pay by phone or at a branch (rather than online), and you’ll often pay higher fees if you pay by credit or debit card. |
| R | Receiving | Sometimes called incoming fees for receiving money overseas. |
| T | Transfer amount | A percentage-based fee based on the amount of the transfer. |
Typically, with a money transfer provider, you will only incur one fee — a transfer fee — and some charge no fee at all. Most providers do not charge the receiving party a fee, and tracking the transfer is also free. The amount of the transfer fee can vary from provider to provider, and depending on the method of transfer — online or at an agent location — and the method of delivery — cash pick-up or bank deposit. But you will likely encounter only one fee. However, don’t neglect to weigh the exchange rate as well when deciding which provider to go with.
There are a number of international transfer companies that don’t charge a transfer fee. For example, TorFX makes money by applying a margin to the exchange rate (but it still ends up being significantly cheaper than using your banking institution). Be sure to compare quotes from providers that do and don’t charge a transfer fee. You may find that paying a higher transfer fee leaves you better off at the end of the day because of a more favorable exchange rate.
If you want to get the best deal you can, it’s a good idea to compare non-bank international money transfer providers. Peer-2-peer (P2P) international money transfer companies can give you an exchange rate that is just a touch above the market foreign exchange rate. While it’s difficult to get the market rate if you’re an everyday consumer, these P2P companies can give you access to some of the best foreign exchange rates around.
Pay attention to the fees when you send money overseas. Although some of them can’t be avoided, others can, and there’s no reason why you shouldn’t shop around to find the best deal when sending money overseas. And don’t forget to take the exchange rate into consideration when determining which provider to use. A company that doesn’t charge a transfer fee might make up for this by offering a poor exchange rate.
How much you’ll pay for a money transfer depends on factors like:
In general, you’ll pay more for an international wire transfer through your bank than if you use an independent money transfer service like Wise, which offers stronger exchange rates and lower transfer fees.
Find out how to get the best foreign exchange rate when you send money overseas.
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Lilli needs to send $1,000 to her host family in Sydney ahead of studying abroad. While she’s comfortable with the security and familiarity of her local Bank of America, where she holds an account, she decides to compare its rates and fees against a popular online money transfer service.
Here’s a breakdown of what Jessica could pay to transfer $1,000 to Australia:
| Bank of America | Online money transfer service | |
|---|---|---|
| Transfer fee | $35 (outgoing international fee) | $5 |
| Exchange rate | 1 USD = 1.28 AUD | 1 USD = 1.32 AUD |
| Transfer method | Online deposit | Online deposit |
| Transfer speed | 1–2 days | 1–2 days |
| Total AUD received | 1,235 AUD | 1,313 AUD |
Jessica’s learns that her bank not only charges an outrageously high transfer fee but also offers a weaker exchange rate. By going with a money transfer service like OFX or Wise, Jessica could save $30 in fees and send 78 more Australian dollars to her host family — a lot more to help them in preparing for her stay.
Just how much do banks charge for transfers?
Smaller transfers don’t mean lower fees. But you do have options when sending $100 or less.
You’ve seen ads for providers offering low or no fees on international money transfers. Those ads don’t tell you that you often need to send $5,000 or more to get such low fees. But what if you need to send only $100 in spending money to your grandchild in the UK or a $50 gift to a friend in Mexico? You might expect that such a transaction would attract a smaller fee than sending, say, $2,500.
Unfortunately, your local bank and time-tested providers like Western Union could charge you $35 or more to wire the money — a significant chunk out of such a small amount. However, companies like Wise, Xoom and Ria are undercutting the competition to earn your business with better deals. Even if you’re looking to send only $100.
The next time you need to send money to friends, family or businesses overseas, you’ll likely pay a transfer fee and a margin on the exchange rate.
But by comparing your options, you can be sure you’re getting the best deal for your situation.
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Receiving money feeYou can be charged a fee for receiving a payment from an overseas beneficiary.im from brunei did i have to pay the fee because im waitting transfer money from ur country..did i have to pay the fee…how much the fee its
Hi Sweety!
There’s only one fee involved when you receive money overseas and that is the RECEIVING MONEY FEE. Generally, there is no receiving fee involved, best to ask the provider regarding fees and mode of transfer. On the side of the sender, he will incur a transfer fee. The price will also depend on the provider and mode of transfer to be used.
Hope this clarifies.
Regards,
Nikki
Hi, I live in Australia but spend most of the time in Indonesia. The exchange rate has gone up to a 4year high. If I were to exchange 100,000 AUD, I would be approx 40% RPH better off than the usual trading position. Then if I waited till AUD returned to traditional position and brought back 100,000AUD and then waited for spike and bought Rph again. I would be doing ok.
I would value your comments.
Thanks Martin
Hi Martin,
Thank you for reaching out to us.
As we are a comparison website and general information service, I’m afraid we may not be able to advise as to when you should have your AUD convert to Rupiah as that will ultimately depend on your need of cash or the reason for the currency exchange.
If you will be changing your AUD in Indonesia, best to consult any available Foreign Exchange Bureau for your options.
Let us know if there is anything else that we may assist you with.
Cheers,
Ash