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Cheap ways to send money overseas
Save when you send money internationally with a secure online transfer.
Western Union and MoneyGram are known for their ability to send cash across the world in minutes, but you can save on fees and get a better exchange rate with an online transfer company — though you may have to wait a day for your funds to arrive.
Who usually transfers money overseas?
As the internet and other tech advancements have overcome the barriers of geographical distance, more and more countries have opened their doors to trade and become global citizens. As a result, the need for Americans and citizens of other countries around the world to send money overseas has rapidly expanded. Those who most commonly need to send money overseas tend to be:
- Overseas workers
- Overseas students
- People moving overseas
- Returning expats
- People with friends or family members traveling overseas
What are all the ways that I can send money overseas?
You may think that the convenience of your local bank is your best option. While banks offer secure wire transfers around the world, their services don’t come cheap. Banks offer weaker exchange rates, higher fees and fewer options to send and receive cash when compared with a money transfer service.
With so many specialized money transfer companies to choose from, it’s no surprise that you have options when it comes to how your recipient receives your funds.
Unlike banks, services like OFX and XE specialize in one thing: transferring money to countries worldwide. With this expertise comes superior exchange rates and lower fees than a bank can offer, resulting in savings for you — and more money in the pocket of your recipient.
How you send your money and how it’s received will ultimately affect delivery speed — from minutes to several business days.
In general, your options include:
- Bank transfers. Many major US banks can safely wire your funds to countries around the world. Banks rely on existing links between banks and banking systems worldwide. However, a downside is the frustratingly high fees and weaker exchange rates you’ll typically receive.
- Online money transfer services. These specialists offer more affordable transfers than banks do, allowing you to quickly and easily manage your transactions from home. With competitive exchange rates and lower fees, you can send funds from your bank account. Many also allow you to pay with a credit or debit card.
- Providers with cash pickup. Trusted providers like Western Union and MoneyGram offer the key advantage of giving your recipient fast access to the cash you send — sometimes within minutes. You can often pay online or at one of the thousands of agent locations worldwide. However, services typically cost more than an online transfer specialist and vary by where you’re transferring your money and how you’re paying for it.
- PayPal transfers. Not just for online purchases, PayPal offers transfers to more than 100 countries and supports multiple currencies. Its exchange rates are often better than those you’ll get from a bank but not quite as strong as rates from money transfer companies. PayPal calculates its transfer fee as a percentage of the amount you’re sending — meaning it’s often better for sending smaller amounts of money.
- Checks and money orders. Although not a quick option, you could send an international check overseas, obtained from your bank or US Postal Service. It costs a little more — you’ll have to purchase the check, and your recipient may be charged a fee by their own bank when cashed.
XE Money Transfer
XE specializes in a wide range of foreign currency solutions and offers an affordable solution when you need to send money overseas.
- Send money to 200+ countries.
- Competitive exchange rates that are often better than banks.
- Transfer up to $500,000 online.
- See exchange rates in real-time.
How do I send an overseas transfer with an online specialist?
Although the process differs by company, to send money overseas you’ll generally:
- Register for an account. This is often a free part of initiating your transfer. You’ll provide your full name, contact info and date of birth. Some providers also require proof of ID.
- Provide your recipient’s details. Specify who’s receiving the funds by providing their name and contact information. If you’re sending money for a deposit, you’ll include the bank name, SWIFT code and your recipient’s account number.
- Indicate the details of your transaction. Enter how much money you’re sending and in which currency it will be received.
- Review the details of your transaction. For most providers, you’ll see a summary of your transfer showing the amount you’re sending, the exchange rate, any fee you’ll pay and the total your beneficiary will receive.
- Pay for your transfer. Payment methods vary by company but could include credit or debit card, bank account, cash or mobile wallet.
- Track your transaction. You should receive confirmation that includes a tracking number or receipt for monitoring the progress of your transfer online or with a company branch.
You may also receive an email or text when your beneficiary has received your funds and the transaction is completed.
Compare your options for sending money internationally
Use our interactive table to compare transfer fees, exchange rates and other details for sending funds overseas with our money transfer partners.
How can I save money when making a money transfer?
Fees can vary widely depending on the provider you’re transferring with. Overall, providers make money on your transfer in two ways: by marking up the exchange rate and by charging you a transfer fee.
- Compare exchange rates. Use your currency’s mid-market rate as a baseline to compare against the rates you’re offered. You want a provider whose rate is closest.
- Send more money per transfer. Many providers discount transfer fees or waive them altogether when you send larger amounts.
- Look for hidden fees. Avoid surprises by reading the fine print for fees that could apply to your transfer, including charges your recipient will need to pay.
- Sniff out special offers. Keep an eye on promotions that offer, for example, no fees on your first transfer. While ideal for limited transfer needs, you could also end up with a new preferred service.
- Shop around. The best way to save is by comparing rates, fees and transfer speeds of each provider, closely looking at their benefits and drawbacks.
How transfer fees affect your total cost
Transfer fees can range from a few dollars to up to $80 or more, with some providers taking even more as a percentage on your total amount.
Depending on the provider, your transaction fee could be:
- A flat fee on the transfer, no matter the amount you’re sending.
- A tiered-fee structure — for instance, $5 for transactions under $500 or $10 for transactions under $1,000.
- A fee calculated as a percentage of the total transfer amount.
- $0 if you meet a fee-free threshold — $5,000 or more with some providers.
Be wary of other fees that could apply. For example, a provider could charge your recipient a fee to cash a bank check or pick up cash in person.
The importance of a competitive exchange rate
Banks and other services are likely to add a little to the exchange rate, “padding the rate” to increase their profits. While a few cents may not sound like a lot on its own, when you multiply it by the $2,000 you plan on sending overseas, it can add up to a big difference in the amount ultimately received.
Specialized money transfer services typically offer rates that are closer to the mid-market rate.
How to get the best exchange rate
Banks vs. money transfer services
Ross wants to send $1,000 overseas to his partner in Chennai. He’s heard that banks usually charge a pretty penny for sending international transfers, and so he compares his bank with an online money transfer provider to see which offers better value for his money.
|Major US bank||Money transfer company|
|Exchange rate||1 USD = 62.28 INR||1 USD = 67.52 INR|
|Transfer speed||2–5 business days||1–3 business days|
|Transfer options||Online, in branch||Online|
|Total EUR received||62,280 INR||67,520 INR|
Skipping the banks, Ross could save $22 in transfer fees alone by sending his cash with a money transfer company. He’d also send an extra 5,240 rupees — more than $75 — to his partner. And in fewer days.
Tools to save on an international transfer
There’s a lot riding on a competitive exchange rate and low fee. But depending on how much you’re sending, how soon your recipient needs it and rates at the time of transfer, you could save even more with the following tools.
- Forward contracts. With this tool, you lock in a favorable exchange rate for a future transfer, avoiding unpredictable movements in the rate.
- Limit orders. A limit order allows you to request a transfer that’s executed only when a specific rate is reached, at which point your provider locks it in.
- Regular transfers. You may be able to shave a few pennies off an exchange rate or pay lower transfer fees by setting up a plan to automate more regular payments overseas.
- Same-currency transfers. It can sometimes be cheaper to transfer US dollars to your recipient, allowing them to transfer these dollars into their own currency when received. Your recipient may be able to pay lower fees overall this way.
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