International Money Transfers| What are the ways to Send Money Abroad?
International Money Transfers: Whether you want to transfer money to Nepal or anywhere else, the process of sending money abroad can be a daunting experience if you have not done it before. While sending money abroad, you might have realized that it can cost you a lot if you are not aware of several factors.
So, before knowing how an international money transfer works, let us figure out what it means. Most people confuse outward remittance with international money transfer. Although they are similar in many ways, they have noticeable differences.
For instance, remittances enable foreign workers to send low-value money to their family members in their home country. Whereas, there is no such distinction in international money transfers. It refers to the money transfer from a home bank account to an overseas bank account.
How does it work?
There are three key players in an international money transfer:
- The sender
- The recipient
- The money transfer service provider
To make an international money transfer, you (the sender) need to initiate a money transfer required with your preferred service provider. You can choose to send money overseas in person or online. You will need to provide the recipient’s details and pay the transfer amount.
After receiving the payment, the money transfer service provider will send the funds to the recipient, and the recipient will receive the money in their account or cash. It can take form 2 to 4 working days to transfer the money.
What are the ways to send money abroad?
There are several ways you can opt to make an international money transfer, such as:
You can visit your bank in person to make an international money transfer, but it is cheaper and more convenient to do it through online banking. Your bank could charge you more to transfer money from one of its branches.
It is worth noting that banks are a little costlier than other options. The reason they are expensive is because of the average transfer fee of 11%. At times, it is difficult to know in advance how much the transfer will cost you, and you may end up paying more to guarantee that the recipient will receive the funds in their account.
- Online money transfer service
With the advancement of technology and the internet, international money transfers through online money transfer services have become less costly and more transparent. You can avail of low transfer fees. Making an international money transfer is simple and easy. All you have to do is to create an online account and get your account verified. After that, you can make an online money transfer from anywhere at any time. The best part is that online money transfer services are transparent with their fees, enabling you to know in advance how much a transfer can cost you.
- Cash transfer service
It is the best option if you want to pay for your transfer in cash. Unlike a bank transfer, you do not need to have a bank account to send or receive money from abroad. To make an international money transfer, visit one of the cash transfer services in your locality and fill up the money transfer form. After paying the transfer amount along with the fees, the recipient will be able to pick up cash within just an hour. However, compared to online transfer services, the cash transfer fee can be a burden.
What are the costs involved?
There is no way to know how much it will cost to send money abroad. The transfer fee and the foreign exchange rates vary across banks and money transfer services. It would be wise to compare different services before making an international money transfer.
While deciding to choose a money transfer service provider, make your comparison based on the transfer fee and the foreign exchange rate.
- Transfer fee
The fee to transfer money to Nepal or anywhere depends on the service provider you opt for. However, you will generally be charged a fixed transfer. It also depends on the amount of money you are transferring, the destination country, and how you are paying for the transfer.
- The markup on the foreign exchange rate
Besides the transfer fee, banks and money transfer services also add makeup to the foreign exchange rate to convert your money. For instance, if you send Rs. 5000/- to someone in Nepal, you will have to pay an extra 3% to 5% more in addition to the transfer fee. It is because of the markup. So, before making a transfer, make sure you are aware of the foreign exchange rates, as it can cost you a lot if you are sending a large amount of money.