Say adiós to the bank
When considering how to send money to friends, family and businesses outside the US, you may want to look outside your bank. We analyzed the findings from the World Bank’s Remittance Prices Worldwide June 2017 report for a remittance — money transfers — of $200 dollars. For its calculations, the World Bank included both transfer fees and currency exchange fees, noting them as a percentage of the total remittance amount reported.
We found that from 2015, fees charged by banks for sending money internationally from the US have climbed higher than the global average. As of 2017, banks charge an average 8.8% of all money transfers from the US in fees. In contrast, global, US and money transfer operator fee averages have dropped.
The World Bank surveyed 23 bank providers and 83 money transfer operators for sending a $200 remittance internationally from the US. The data reveals that globally, the average fee charged by banks for sending a remittance dropped from 9.10% in 2011 to 7.33% in 2017. In response to this decrease in transfer fees, money transfer operators followed suit by lowering their fees from 6.53% in 2011 to 5.49% in 2017. Note that this figure is noticeably smaller than the average price for transferring money, regardless of the method you use.
What could a higher bank fee potentially cost you?
Consider someone who plans to send a remittance to their family in Mexico. More money is sent to Mexico from the US than from anywhere else on the planet. According to finder.com analysis of 2,000 people we surveyed, the average annual estimate for money sent to Mexico is $4,178 dollars. Based on that figure alone, the average annual savings on remittances when using a money transfer operator is $138 a year — or nearly 2,500 pesos!
Western Union and MoneyGram may be the best-known money transfer operators, but you’ll find many other providers — especially online — offering stronger rates and cheaper fees. These providers include TransferWise, WorldRemit and World First.
Let finder.com’s comparison calculators help you find the best deal on your next money transfer.