Why you can now save money on your transfers
An international money transfer, also known as international remittance, is simply when you send funds overseas. Generally, a transfer involves you sending money as cash or from a bank account to an intermediary transfer service or bank, which then sends the money to your recipient in another country.
Fees are almost always added to your transfer when you make it, and your recipient can also pay when receiving your money – depending on the service you choose and the bank your recipient is with.
Exchange rates also play an important part when sending money overseas, because sending money overseas also involves changing currency from one (usually US dollars), to your destination country’s currency.
Most banks can send money overseas using your bank account, but because this is not a bank’s main concern, exchange rates and fees tend to not be as competitive. Dedicated transfer services on the other hand can sometimes offer better rates and fees, or faster transfer speeds.Back to top
As we mentioned above, a money transfer usually involves you sending money using cash, or from your bank account. Here’s an example of a transfer where you have cash which you want to send to a loved one overseas:
Alex sends money to Mexico
Alex has been living in the States for over 15 years after moving here from Mexico as a young man. His parents, as well as his brothers, still live in Mexico and run the family business.
From time to time Alex sends money to his family to help them with expensive one off expenses, bills and business purchases.
Alex wants to send $1000 USD to his family to repair a damaged roof which is stopping their business from opening and trading. He goes to his closest Ria agency and hands them the $1000.
They let him know their exchange rate at the time of transfer, as well as the fees he’ll be paying.
- Exchange rate: 1 USD = 15.47 MXN
- Transfer fee: $4 USD
- Total cost of sending $1000 USD to Mexico = $1004 USD
- Total amount his father will receive = 15,470 MXN.
Because Alex’s father’s business predominately operates with cash, Alex sends the money to his father and has it made available as a cash pickup.
Alex’s father receives the money on the same day and is able to commence roof repairs.
The simplistic example above doesn’t take into account any of the other ways Alex could’ve sent the money internationally. Here are all the ways you can possibly send money abroad:
With a cashier’s check
The slowest way to send money overseas involves you actually sending the money overseas via snail mail. This method will involve you going to your bank and giving your cashier the details of the transfer, such as who you’re sending it to and where. You’ll also usually have to pay a transfer fee at this point. Next, you’ll need to mail the check over to your recipient. Not every bank will be able to do this, and service fees can vary.
International money order
International money orders are exchanged for cash at your local USPS Post Office, and then sent to your recipient overseas. You can send Money Orders up to $700 in value, and they cost $4.50. Note that money orders are not accepted in every country. The benefit of a money order is that if it’s lost or damaged it can be replaced. USPS charges a $6.10 fee for this.
A bank wire transfer
Another common way to send money overseas is to send money through your bank account as a wire transfer. These can be carried out at a branch, online or over the phone, and just like sending a cashier’s check, you’ll need the bank details of your recipient, and will pay a hefty transfer fee. Your recipient might also need to pay fees to receive the money. Wire transfers from your bank account are generally only recommended if you’re sending larger amounts, although some banks have services for smaller amounts too, such as Wells Fargo’s ExpressSend Service.
Money transfer service
As we mentioned at the start of this article, there are a large range of money transfer providers, including well known wire transfer services, and newer online-only services. Money transfer services can work in the following ways:
- Cash-to-cash transfers. Services like Western Union, Ria and MoneyGram allow you to walk into a branch with cash, send it to your recipient overseas, and then have it picked up as cash from a branch near your recipient.
- Bank account to bank account transfers. With these types of services, you send your money to the transfer service’s bank account from your own bank account, and the funds are then sent to your recipient overseas. Established services like Western Union, MoneyGram, PayPal and Ria offer this, as well as newer companies like USForex, WorldRemit and Remit2India.
Most of the transfer services which allow you to send and receive cash allow your recipient to pick up their funds, making it almost instant. Larger payment networks like the below also allow for near instant transfers:
- Western Union
Because of the large number of countries Americans do business with and have personal relationships with, almost all currencies are available. Larger networks such as Western Union will have the largest number of possible currencies, whereas smaller banks and other services will usually limit their supported currencies to the most popular ones, including:
- Mexican Pesos
- Philippine Pesos
- India Rupee
- Kenya Shilling
- Nigeria Naira
- Nepalese Rupee
- Jamaican Dollar
- Canada Dollar
- Bangladeshi Taka
- Pound Sterling
- Chinese Yuan
- Colombian Peso
- Dominican Peso
- Peruvian Nuevo Sol
- Vietnamese Dong
- Guatemalan Quetzal
- Swiss Franc
- United Arab Emirates Dirham
- Hong Kong Dollar
- Japanese Yen
- Norwegian Kroner
There’s no one best way to transfer funds overseas as it’ll depend on how much you’re sending, how soon you need it to be made available, and the exchange rates available, but below are some tips you can use when sending money overseas.
- Send more money per transfer. Many services discount the fees or waive them altogether when you send larger transfers. USForex for example will waive fees for all transfers above $5000. Sending less than this will come with a fee of $5.
- Utilise forward contracts and limit orders if regularly sending money. A forward contract essentially allows you to lock in a favorable exchange rate for later transfers. This means you avoid any nasty movements in exchange rates. A limit order allows you to wait until a favorable exchange rate is found. This is then locked in for your transfer.
- Send same currency transfers. It can sometimes be cheaper to transfer US dollars to your recipient, allowing them to transfer the dollars into their own currency when they receive them. Depending on the situation, the fees your recipient will pay can be lower.
What’s are the best international money transfer services?
Out of the money transfer services featured on finder.com:
- Which money transfer service is the cheapest with the lowest rate and fees? TorFX International Money Transfers
- Which money transfer service is the fastest? WorldRemit allows you transfer funds to be received by the recipient within 1 hour
- Which money transfer service allows you to send the most amount of money? TransferWise allows you to transfer the equivalent of £1,000,000 GBP in USD at the current mid-market rate.
- Which service has the lowest minimum amount you could send? TransferWise allows you to transfer $1.
Top 10 Most Popular Money Transfer Companies
- Western Union
- RIA Money Transfer
- Bank of America
- Wells Fargo
Below are some of the important ways you can compare money transfer services. The importance you place on each will depend on your situation:
- Exchange rate. The exchange rate is the rate at which your money will be converted to your target currency. Some transfer services will offer low fees and a poor exchange rate, while others may charge no fees, and instead make a profit from the margin between the interbank rate and their rate. Other services may offer high fees but offer competitive rates, and some services buck the trend and offer great fees and rates.
- Fees. Your bank or transfer service will generally charge fees for making a transfer. These can vary wildly depending on who you’re transferring with. Look at the below table for an indication of the fees you would pay for sending money to India, as an example.
|Ria||MoneyGram||WorldFirst||WellsFargo||UsForex||Xoom money transfer|
|Fees||$0||$4.99 from bank account/ $10 from credit or debit card||$10||$0 (free over $500)||$5||$0 (free over $1000)|
|Exchange rates (1 USD = INR)||63.07||63.08||63.56||62.64||63.59||62.81|
- Transfer options. Some transfer services like USForex will allow you to make forward contracts and limit orders, which can get you a competitive exchange rate. Others can allow you to make regular payments, which can be beneficial if you’re paying off a mortgage on an overseas property for example. Another important option is how you can send the money overseas in the first place. If you need to send cash then you’ll want to compare options including Ria, MoneyGram, Western Union and others.
- Receiving options. Depending on your recipient, you may need to send money which can be picked up as cash. Alternatively, they may want the transfer in check form. Compare providers based on how the money can be picked up by your recipient.
- Getting lured in with mid-market rates. Many transfer services and banks will display competitive exchange rates to lure you in. The problem is that these rates aren’t always what you’ll actually receive. Instead, they’re the competitive mid-market rates banks get access to. The real rate you’ll receive will have a margin tacked onto it, so ensure that you compare rates based on actual quotes and not advertisements.
- Sending cash overseas yourself. Some reading this may wonder why they shouldn’t just convert the cash and then send it overseas in the mail. The reason is this: cash can’t be replaced when lost, stolen or heavily damaged. This means if the unthinkable should happen to your letter, i.e the postal system loses it, your whole transfer is also lost – leaving you still responsible for sending the funds. If you can’t send a cashier’s check, but still want to send a physical transfer overseas, consider a money order.
How can I track the progress of my money transfer?
Most services will give you a tracking number or ID that you can use to check the status of your transfer. In many cases, your recipient will also receive one so they can check.
What’s the maximum amount I can send overseas?
This will depend on both the transfer service you use, and the type of transfer you’re making. Money orders through USPS are capped at $700, although you can send multiple orders. MoneyGram and Ria both have a per transfer limit of $2999.99. These providers also have 30-day transfer limits of $3,000 and $7,999. Services like Xoom will allow you to transfer up to $2,999 per transaction with a 30-day limit of $6,000, but can increase this limit if more information is provided.
What’s the minimum amount I can send overseas?
Again, this will depend on the service you use. USForex has a slightly higher minimum of $1000 for example, while other services might not set a minimum.
Why can’t I sent money to a particular country with my selected transfer service?
This could be for a few reasons – including if the country is currently under economic sanctions, such as Iran, or if your transfer service hasn’t yet built the facilities and networks needed to send money to a particular country. You can see the countries you can send money to on our individual review pages.
How long does money take to arrive?
The quickest money transfers will arrive instantly depending on the specific service you use. This will depend on where you’re sending the money to and the service you’re using. Western Union can have funds available almost instantly. MoneyGram on the other hand can have funds being sent to China available in as little as an hour, but available the next day when sending money to France.
Other services like USForex can take longer then the quicker cash services like MoneyGram and Western Union. Sending money to Australia using USForex will take at least a day, whereas countries like Canada can take 1 – 3 days.