There are many people who live in the United States but are from different parts of the world. As such, they have family and friends at home whom they would like to send money to for one reason or the other. However, at times it gets tricky as you do not know the best method to carry out the cash transfer. This is because there are several ways of internationally transferring money in and out of the US that exist thus causing confusion among users. In order for the transfer to be successful, there are some conditions that the sender and the receiver must fulfill.
Does all this seem complicated to you? Worry not. This is because in this guide you will learn all about bank transfers. You will know the details that you need for an international money transfer, learn the best way of transferring money internationally, conditions to transfer, how you can save money when making a money transfer, how transfer fees affect your total cost and so much more.
Therefore, without much ado, let us get right into it.
What Details Do I Need for an International Bank Transfer?
If you are sending money over the bank’s international wire transfer, you need to know recipient’s full name and address, name and full address of recipient’s bank, recipient’s account number and account type (e.g., checking or savings), the bank’s routing number, the bank’s SWIFT or BIC code (if applicable), the bank’s IBAN (if applicable), transfer amount, reason for the transfer.
But you might not need that much detail, if you use digital money transfer services like PayPal, TransferWise, etc., and usually, they have their own form for transfer detail. If the recipient has an account with those services, the transfer will be easier.
8 Best Ways of Transferring Money Internationally
As earlier stated, at times, you might want to send money internationally but you are not sure about how to go about the whole process. We have already discussed how to send money using the banks. But there are more ways of transferring money internationally who are in overseas.
TransferWise is an electronic money institution but it’s not an actual bank. Established in 2011, it has already brought radical changes in the international money transferring system with transparency and simplicity. It’s a UK-based company that operates in 59 countries worldwide with 14 offices and multilingual people are involved in this operation to avoid complicated automated systems.
Basic features & functions: The process of money transfer with TransferWise is simple and revolutionary. Suppose, you want to send money from the USA to England. On the same day, if someone in England wants to send money to the USA, you can deposit the dollar in that account and that person will deposit British pound in your account in England. Thus, you can bypass the cost and time-consuming process of wire transfer and that’s how the TransferWise works.
To send the money, you have to sign up online for a free account. After that, select the amount of funds you want to transfer and upload the bank account details of the recipient. TransferWise will charge you accordingly which is minimum compared with the wire transfer fee.
Transferable fund limit: From USA, the maximum transferable fund is 1,000,000 USD per transfer using personal and business accounts, 15,000 USD per day using bank debit (ACH) (this limit will reset 24 hours after receiving the fund), and 2,000 USD per 24 hours and 8,000 USD per 7 days using debit or credit cards.
Time period: If you use a debit or credit card, the transfer is instant. Other methods require time which depends on various factors.
OFX with headquarters in San Francisco has offices in over 6 countries and you can send money in 55 currencies over 16 countries using this service.
Basic features & functions: OFX doesn’t charge directly for international money transferring services. Instead, it profits from the markup rate which is the difference between the exchange rate and OFX’s own rate. This markup rate is way less than the traditional money transfer services. To engage its services, you have to register and get verified. Then log in to upload the recipient’s bank account details and lock in your transfer. You can transfer the fund to OFX by direct debit or wire transfer. It doesn’t accept cash.
Transferable fund limit: there is no limit of either the amount you can transfer or the time period. But your bank might restrict the maximum amount you can transfer to OFX’s account
Time period: it will take one to two days to deliver the money
Xoom originated in 2001 and later it was consumed by PayPal in 2015. This is another smart choice to send money abroad because it offers a fast, easy, and secure way to handle your money in over 70 countries. The citizens of the U.S. and Canada can send money only.
Basic features & functions: Apart from sending money abroad, you can pay bills and reload your phone using a Xoom account and create an account, you can visit the Xoom website or download the app. You have to fill the signup form and verify email authentication. Also, you have to set up a first payment source such as a bank account, credit card, or debit card to your Xoom account.
For a fund transfer, Xoom will charge you under $5 which depends on transaction type, amount of fund, currency type, destination, etc. and there is a fee calculator to calculate the exact amount. However, Xoom is still cheaper than a traditional wire transfer.
Transferable fund limit: If you are in the USA, you can make a cash withdrawal or bank deposit of $100,000 per 180 days. But there are three different levels and each level has their own limit.
Time period: Usually, fund transfer is completed instantly whatever the payment method is. But factors like time zone, banking hours, etc. can delay the process which might take a few business days.
Started in 2010, WorldRemit focuses on sending money to the under-banked societies around the world. It provides multiple options like cash pickup or mobile money to assist people who have minimum interaction with banks.
Basic features & functions: The service of WorldRemit is fast and rather simple. 90% of the transactions are done in minutes and it can send money to over 140 countries from 50 countries in 90 currencies. It’s a fully online-based company and it has no offices or agents. The process to transfer your money is very easy, register for free on the website or mobile app and upload information like transfer details, how much money, and details but not necessarily bank information of the person you are sending the money to, and finally, pay the money via Apple pay, bank transfer, credit or debit cards, etc… The charge of the fund transfer depends on different factors and on average; it is 48% cheaper than the bank transfer.
Transferable fund limit: The fund is limited by the rules and regulations of the country you live in.
Time period: Most of the transfers are instantaneous but home delivery would take 1 to 7 days.
5. Bank Transfer
Most US banks offer wire transfers which tend to be more costly than money transfer agencies. If your bank has branches or partner institutions in other countries, it is also possible to send money to those places.
Basic features & functions: In this process, both sender and receiver of the funds have to have bank accounts. There are several processes for international fund transfer like ACH, Domestic Wire (USA), SWIFT, SEPA Bank Transfer, SOFORT (EUR), Direct Debit, Local Bank Transfer, Bill Payment (Canada), POLi, BPay, Domestic Bank Transfers (Australia), Domestic Bank Transfers (UK) etc. and each has their own rules, regulation, and fees.
Transferable fund limit: Usually, a bank transfer is preferred for a significant amount of money. The maximum limit is set by your bank and the recipient’s bank as well.
Avoiding issues with transfer money: Double-check every figure, even if your bank preloads them. It’s difficult to receive your money back if you send it to the wrong account. If you are making a transfer through your telephone banking service, ask the person accepting your call to reply to every number and letter to you.
Time period: It might take several business days.
6. Western Union
Western Union functions like a pay-in network that includes retail locations over 500,000 and digital and account payouts. The company has its own mechanisms to calculate the exchange rate in both ends and tracking and risk-assessment technology to support compliance with local regulations of 200+ countries.
Basic features & functions: There are several ways you can transfer money using Western Union. To send the fund online, download the app or visit the Western Union website and then create your profile. There are some steps you have to follow and provide some information.
In addition to that, you can send money in person in a Western Union agent location, you can pay using a debit card or cash and the agent will help you with the remaining formalities. If you start the online process before going to an agent, you will be able to save time. Telephone transfer is also possible and you have to call the number given on the website to do that.
To transfer up to $1,000 the charge is $5. Depending on the destination, the rate markups will vary from 1% to over 6%.
Transferable fund limit: Your fund limit depends on transfer history, both your and the recipient’s location, criteria of the service you have chosen, your agent location limit, country limit, and your payment method. If you want to send money in person, you have to look for the agent’s location and their limits. You can also call customer care for the telephone money transfer limit.
Time period: Since, there are different processes, time required also varies from process to process. You will be able to send the money within minutes using the mobile app or in an agent location. There is also provision for 24 hours delivery. The direct bank deposit may take 2 to 5 business days which is subject to change depending on the country.
PayPal operates worldwide as a payment processor for online vendors, auction sites, and many other commercial users. PayPal makes the fund transfer abroad very easy and convenient.
Basic features & functions: For international transactions with PayPal, you have to open a PayPal account and then add a bank account or credit or debit card. When a new account is created, a small amount will be transferred to your PayPal wallet to verify. Once verification is completed, you can upload funds and send it to the recipient which can be withdrawn from the bank account.
Transferable fund limit: You can send $10,000 with PayPal account in a single transaction. Without an account, that limit is $4,000. For a person living outside the US who doesn’t have a PayPal account, the maximum limit of a transferable fund depends on the currency.
Time period: If you pay the fund to PayPal using a credit or debit card, it will take minutes to complete the fund transfer. When this payment is made by bank account or eCheck, it will take longer as they have to clear the bank.
MoneyGram is committed to providing innovative solutions in international money transferring and payment services. Established in 1940 as Traveler’s express, which transformed into MoneyGram in 1998, it offers services at approximately 350,000 agent locations in more than 200 countries and it is claimed that MoneyGram is the second-largest money transfer company in the world.
Basic features & functions: On the MoneyGram website, there is a fee calculator to estimate the charges for the service. Once you learn that, you have to register for an account and then select the receiver. After that choose your payment methods. For the checking account payment, which is only available for USA customers only, the fee is minimum. And this fee is higher for credit or debit card payments. The markup rate is over 3%.
Transferable fund limit: Normally, for most of the country, A fund of $10,000.00 per transfer and for every 30 calendar days is transferable online. If you have to send an extra amount, you can do it from a MoneyGram agent location.
Time period: Some transfers are completed within an hour. But others may take longer than that. It depends on the destination country, banking hours, and systems availability.
How to Avoid Issues with Money Transferring Internationally
When money is being dealt with and transfer, many people resort to fear. Although there is no way to completely assure you that nothing will go wrong, there are some ways that must help you achieve that ease of mind and also make sure that things are done properly.
- Always double-check the amount you enter, account number and routing number, and other personal information that you need.
- In most cases, the transaction just won’t go through if you don’t have enough funds on your end. Sometimes, this will lead to costly overdrafts, which you actually want to avoid.
- Whichever way you are applying, there is always customer service available. So, if you are not familiar with the platform, do not guess how things work. Rather call their customer support and ask for direction. If the first time is done accurately, you will make it right next time around on your own.
How Can I Save Money When Making A Money Transfer?
The cost of transferring money internationally differs widely from one platform to the other. Additionally, the cost also depends on the country to which you are sending the cash. There are two ways money transfer companies make their profit. The first one is by marking up the exchange rate and the second one is by charging a transfer fee.
Having said that though, there are some ways in which you can save a dollar or two when sending money from the US to other countries.
The very first thing that you need to do before internationally transferring money is to choose the platform with the best exchange rates. Many platforms show their exchange rates and it is therefore upon you to select the one whose rate is the best.
The second way that you can save on cash is by sending a larger amount. Most transfer companies offer a discount when you send large sums. Some even waiver the transfer fees altogether.
The third way of making a saving is looking for any hidden charges. Before you choose any platform, make sure that you find out if there are any hidden charges that might add to the cost of sending the cash. Some transfer companies also charge the recipients.
The fourth way is to look out for special offers. However, if the money is needed for an emergency, you might not have time to wait for special offers. But when it is not an emergency, you might wait for a transfer company to have a special transfer offer and you can take advantage of the lower prices.
How Do Transfer Fees Affect Your Total Cost?
Transfer fees have a great effect on the total cost of your cash transfer. Some companies charge just a few dollars while others can charge an upward of $80 which is pretty expensive. Others calculate the transfer fee as a percentage of the cash you are sending. Therefore, the higher the percentage, the higher the transfer fees charged. Your transfer fee is dependent on the system that a transfer company uses to determine how much they should charge.
The different transfer fee-charging systems are:
A flat fee system: In this system, the company charges a flat fee regardless of the amount that you are sending.
The second system is known as the tiered fee structure: With this system, the company charges a certain fee up to a certain amount of cash you are sending. For example, if you are sending$100 dollars then you will be charged $3 and if you are sending $200, you will be charged $5 and so forth.
As a percentage: In this system, you are charged a percentage of the transfer amount.
FAQ – Frequently Ask Questions
How long do transfers usually take?
Usually, it depends on the service provider and it would take several business days or longer. Expedited transfer service is also available where the fund transfer completes within a single day. Ask for the charges and time it would take explicitly to the service provider.
What is the cheapest way to transferring money internationally?
Depending on the amount of funds, there are multiple ways to send the money with a minimum transfer charge. For a small fund of less than $500, PayPal is the cheapest option. If the amount is between $500 to $7,000, p2p services will be cost-effective. TransferWise and CurrencyFair are good options in this scenario. There are other services like OFX, and TorFX and they are the cheapest and the best ways to transfer more than $7,000 internationally. As the fund grows higher, the service charge of these services decreases.
Can I use PayPal to transferring money internationally?
Yes. Xoom, a sister concern of PayPal is a popular option. Although it charges handsomely, the fund will be transferred almost instantly.
Which bank is best for international transfers?
On a survey conducted by TransferWise, it is found that the USA bank stipulates the transfer fee for senders in an effort to cover the cost of correspondent bank fees. It is hard to compare with other banks in the USA, as they don’t mention it at all.
How much are international bank transfers?
Typical wire transfer fees for the international bank transfer are $15 for domestic incoming, $25 for domestic outgoing, $15 for international incoming, and $45 for international outgoing. Many banks will charge for both sending and receiving the wire transfer.
How do I avoid international wire transfer fees?
By engaging p2p services like TransferWise, OFX, Xoom, etc. you will be able to bypass the high wire transfer charges associated with traditional banking systems.
What if I only want to transfer a small amount of money?
For some service providers, there is a minimum transferable fund which can be $250, $500, or more. If a small fund is involved, you should consider PayPal or TransferWise.
Can I transfer money from my smartphone?
With a dedicated money transfer app, you can transfer money from your smartphone.
Can I change or cancel an international money transfer?
This process depends on the service provider’s policies. Generally, federal protections provide 30 minutes to the money transfer agencies for confirming the transfer, assuming it hasn’t yet been picked up or deposited.
What if I have a problem or can’t track my transfer?
Reputable money transferring agencies have good customer services and they will help you to resolve such issues. You can call them on the phone, live chat, or send an email to lodge your complaint. Help pages or FAQ sections have information, too.
Is it free to register for an account with an online money transfer provider?
Normally, you can open an account with those service providers for free, but sending money may require appropriate duties and fees.
With the plethora of choices out there, you have to be careful and inquisitive to choose the right option. Due to online fraud and scams, be sure that you’re sending money to the correct person, whichever option you choose. You should keep records of your transaction and any confirmation information and pay attention to the time period required to complete the transfer. Don’t forget to compare the charges of different services before sending money.