WorldRemit Offer

- Use promo code 3FREE to get three free transfers
- Easy to use with round-the-clock help
- Get cash to family and friends in minutes
When you need to send an international money transfer to Australia, the United Kingdom, India or anywhere throughout the world, finding the best exchange rate is crucial. The more favourable the exchange rate, the better value for money you will get and the more cash arrives in the recipient’s wallet.
However, if you use your regular bank to send an international money transfer, the chances are you won’t receive the best exchange rate available. Shop around and compare the services of specialist money transfer companies and you may find a better deal.
An exchange rate details the value of one currency in relation to another. You will probably have heard the exchange rate mentioned in the finance news, when the value of one New Zealand dollar is expressed in terms of a range of other currencies. For example, 1 New Zealand dollar may be equal to 60 US cents. Exchange rates are affected by a wide range of factors including the supply and demand of each currency, world events, the performance of national economies and even the level of trade between the two countries.
When you want to send money overseas, you will need to convert your New Zealand dollars into the local currency of your money transfer destination. If you want to send money to France, banks and money transfer companies will convert your New Zealand dollars into euros, at a specified exchange rate.
The exchange rate you see reported on financial news bulletins of on Google is the wholesale or mid-market exchange rate. Banks and other financial companies make their money on international transfers by purchasing currency at the mid-market rate. They then offer it at a lower rate to you on your transactions. This is why it is always a good idea to shop around for the best available exchange rate. While banks usually offer low exchange rates, many specialist online transfer companies offer far better exchange rates to their customers. This means much better value for money for you.
Finding the best exchange rate means you will get the best deal on your international money transfer. A higher exchange rate means more money arrives in your beneficiary’s bank account or wallet, and the bank or money transfer provider takes a lower cut from your transaction. If you need to send a specified amount of money in a foreign currency, you will hand over fewer New Zealand dollars to ensure your beneficiary receives the correct amount.
Ben wants to send $1,000 from New Zealand to his brother Hamish in Italy and decides to shop around for the best possible deal. Hamish is currently on holiday in Europe but unfortunately had his wallet stolen in Rome and is running short of funds. Ben decides to compare his bank’s exchange rate and transfer fee, with those offered by a specialist transfer company online.
As you can see below, Ben can send an extra €16 just by using a money transfer company instead of a major bank and he will also save NZ$25 in transfer fees.
Bank | Money transfer company | |
---|---|---|
Exchange rate | 1 NZD = 0.563 EUR | 1 NZD = 0.579 EUR |
Transfer fee | $30 | $5 |
Transfer method | Bank account transfer | Bank account transfer |
Processing time | 1-3 days | 1-3 days |
Amount received (in EUR) | €563 | €579 |
The best way to ensure you get a great rate from an international money transfer service is to compare the exchange rate with the rates offered by other providers. You can also check the mid-market exchange rate, to get a better idea of whether you are getting value for money.
Many specialist transfer services offer flexible options, to help you lock in a better exchange rate. For example, you can initiate a forward contract to enable you to lock in an exchange rate now for a transaction that will take place months into the future. Alternatively, you can place a exchange rate limit on the order, so your transfer is automatically executed when your desired exchange rate becomes available.
The main risk in using an international money transfer is failure to do your research before you part with your money. When you research and compare options it not only allows you to find the best exchange rate, but also works out the full cost of a transaction before you commit, so make sure you review all the details of a transfer before you agree to anything. It is also important that you make sure you are dealing with a reputable transfer provider.
Read our guide to the WorldFirst World Account for online sellers, including info on supported currencies, fees and how to open an account.
Read more…Learn about the pros and cons of using PayPal to convert your online seller profits into New Zealand dollars in this detailed review.
Read more…Read our guide to Payoneer and how it can help marketplace sellers save money when receiving international payments.
Read more…All the key details you need to know to buy THL shares on the NZX.
We’ll show you what you need to do to buy Arvida shares on the New Zealand Stock Exchange.
Simple, step-by-step instructions if you want to invest in TEM.
Find out how to transfer money from a credit card to your bank account, and what fees you might pay.
We asked 47 experts for their cryptocurrency price predictions and took a deep dive into the Bitcoin price rally.
ANZ offers six KiwiSaver plans and a handy Lifetime Option for investors.
Interactive Brokers offers some of the lowest brokerage fees on the market, but there are caveats you need to be wary of.
The best performing US ETFs over the past year, three years or five years can help inform your decision on what to invest in for the future.
Which online investment platform is the best choice for Kiwis who want to trade US stocks?
Transfer an existing balance and pay 0% p.a. for 12 months, plus enjoy a low interest rate and account fee with The Co-operative Fair Rate card.