Technology has revolutionized our lives in so many ways – including the ability to quickly and easily transfer money overseas. The World Bank estimates that in 2012, approximately $534 billion worldwide was remitted overseas – by expats, international students, overseas workers and overseas investors. We are truly a global economy.
So if you need to transfer money overseas, what are some of the issues that you will have to consider? They include:
What fees will you have to pay?
In order to transfer money, and depending on what type of money transfer service you use, you may be charged a sending fee (as a dollar or percentage amount). The recipient may also be charged a receiving fee by their financial institution once the funds hit their bank account. You might be charged cancellation fees if the transaction needs to be cancelled or amendment fees if a change in details is required. Some financial institutions also charge an investigation fee if a follow-up enquiry is required.
How long will it take for the money to be transferred?
The type of money transfer service you use will in part dictate the length of time needed for the money transfer to be complete. Some online money transfer services happen almost instantaneously, while others (such as an international money order, which is similar to a bank cheque) can take longer. Always ask your service provider how long it should take for the transaction to be completed.
What exchange rate will you receive?
The exchange rate that you receive is likely to have the most significant impact on the total cost of transferring funds. The exchange rate offered can vary materially among service providers so it is certainly worth shopping around, although it can be difficult to reliably compare providers as the exchange rate is often updated continually.
Is there a minimum or maximum amount that can be transferred?
Some service providers will impose a minimum and/or maximum dollar value that can be transferred in one transaction. In some instances the dollar value of your transaction can dictate which method of transferring money will be most cost effective for you.