Studying abroad is a great way to expand your horizons, and many American students take advantage of this for a semester while at university. Figuring out how to pay for your study abroad can be tricky and stressful, but with online money transfer specialists, you can spend less time deciding how to pay and more time deciding where you want to study.
What are my options for paying overseas tuition?
One of the most popular ways to pay for overseas tuition is using an online money transfer, but that isn’t your only option. Consider these five ways to pay for university abroad when making your decision:
An international money transfer can be sent directly to your university of choice through a money transfer provider. When making a money transfer for tuition payments, pay attention to:
Transfer fees. Compare the transaction fees charged by each company to see how much extra you’ll have to pay to send funds overseas. Keep in mind that some providers will waive their fees if you transfer a large amount. OFX charges no fees if you transfer more than $10,000.
Exchange rates. What might sound like a minor difference in exchange rates can have a big impact on the amount of money your beneficiary receives. Shop around for a provider that consistently offers better rates than the competition. Fore example, Wise uses the mid-market rate which is rare among providers.
Customer support. If you ever need help with a transaction, will you be able to access the assistance you need? When will it be available and is it offered online, over the phone or via email?
Compare international money transfer providers to pay for tuition abroad
Our table lets you compare the services you can use to send money abroad. Compare services on transfer speeds and fees, then click Go to site when you're ready to send.
Transferring money directly from your bank to pay for university fees abroad may be more expensive than using an international money transfer service. Because banks often charge high fees and offer poor exchange rates, consider avoiding this method when possible.
Let’s crunch the numbers: Sending $30,000 to the UK
Let’s say you need to send $30,000 to pay for tuition at a university in the UK. Here’s what you might face as far as fees and exchange rates as of June 16, 2020.
Money transfer provider
Bank transfer
Fee
$0
$25 + additional correspondent bank fees
Exchange rate
1 USD = 0.792 GBP
1 USD = 0.754 GBP
Transfer speed
1-2 day
2-5 days
Amount received
GBP 23,756
GBP 22,601
Verdict
Better value and faster
Slower and more expensive
The bank option ends up being both the slower and more expensive option for paying tuition in the UK. If you go with the money transfer provider, your recipient ends up with GBP 1,155 more than the bank offers.
3. International bank draft
An international bank draft is similar to a cashier’s check, but is designed for larger amounts and international situations. Double-check that the university you want to pay tuition at will accept an international bank draft. Some of the pros and cons of international bank drafts include:
Pros
Accepted in most parts of the world. International bank drafts are accepted in the majority of countries around the globe.
Inexpensive. Although you’ll have to pay a fee when you apply for an international bank draft, drafts are still a relatively cost-effective method of sending funds overseas.
Created in the local currency. As the check is made out in the local currency where it will be sent, it does not require conversion and is therefore able to be banked quicker than a check written in USD.
Secure. Bank drafts must be deposited into a bank account and cannot be cashed.
Cons
Slow. Bank drafts typically take several weeks to process, so they’re only a viable option where the speed of the transaction is not a concern.
Availability. There’s a chance your bank may not support the currency and country you want to send a bank draft to.
Time-consuming to replace. Bank drafts are secured and can be replaced when lost, but the process is far from easy. Every bank has its own procedure, and at the very minimum, you’ll have to wait for the bank draft to be delivered internationally a second time.
4. University online payment portal
Many universities that welcome international students offer their own payment portals for international payments. Although these are convenient options for paying tuition abroad, they may not be the best choice when it comes to saving money. A few tips to keep in mind when using an international online payment portal for overseas tuition:
Always navigate to the portal through the official university website. Do not click any links in emails or links found on the search results of Google.
Double-check the exchange rate and fees before confirming payment, as you may be able to save money using a different option such as a money transfer provider.
Ask about deals or discounts based on payment size. Paying an entire year of tuition instead of one semester at a time may secure you stronger exchange rates and lower fees.
5. Cash
Cash should always be a last resort when making international tuition payments. When paying with cash in a foreign currency, you have two options: exchange the cash domestically or abroad. If you opt to exchange domestically, beware of cash limits when traveling internationally by plane. Typically, you can travel with any amount under $10,000, but it’s best to check for any additional restrictions based on your destination.
If you want to exchange cash abroad, consider using a money transfer service that allows you to pick up cash. WorldRemit and MoneyGram are major competitors in this field, and typically offer far stronger rates and lower fees than household names like Western Union.
Bottom line
There are a lot of stressful decisions to make when studying abroad, so figuring out how to pay tuition shouldn’t be one of them. Avoid excess fees and find the right fit for your situation by comparing international money transfer providers.
Whether products shown are available to you is subject to individual provider sole approval and discretion in accordance with the eligibility criteria and T&Cs on the provider website.
Zak Killermann was a technical publisher at Finder who specialised in currencies and investing. Zak’s expertise was in breaking down technical finance concepts into approachable, digestible nuggets of information.
How do you know if your international money transfer made it safely? Learn how to track or cancel, and find out what your rights are when it comes to sending money.
From bank transfers to specialist money transfer companies, there are several options available when you need to transfer money overseas from your bank account.
If you need to transfer money overseas using your credit card, you can do so via your bank, MoneyGram, Western Union and PayPal. This can be useful in emergency situations, but credit card transfers are usually not a cost-effective option.
If you’re looking for a secure way to send money overseas, an international bank draft could be for you — but if speed is important, consider using a money transfer service instead.
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