Tranferring money overseas: How to do it

Whether it’s because you’re moving overseas or whether you’re regularly sending money to family or friends, many New Zealanders sometimes need to transfer money overseas. In fact an estimated 230 million customers worldwide transfer a total of $150 billion per annum.

There are several ways that this transfer can be made; the main options are outlined below.


Online money transfer company

The local online money transfer industry in small but growing and setting up an online account with an online money transfer business and transmitting your funds via the internet can be convenient. The company will convert and deliver your funds into the nominated account. It’s important to note that there may be a minimum transfer amount.

Some possible costs associated with this method include a transfer fee (which may be waived depending on the size of the transfer amount) and transaction costs at the other end. In addition to the speed of transfer, the big advantage of online money transfer companies can be the competitive exchange rate offered. Most online transfer websites will include a currency converter calculator, to give you an indication of the rate that will be applied. It is worth comparing a number of providers to find a competitive rate as the rate offered can make a significant difference to the ultimate value of funds transferred.


Direct transfer via bank account

Making a direct transfer from your domestic bank account to the chosen overseas bank account is perhaps the most convenient way to make an international money transfer in that you are already a customer. It can, however, also be a comparatively expensive option and may take several days to complete.

Some possible costs associated with a direct transfer via bank account could be a “sending fee” charged by your financial institutions, and a “receiving fee” charged by the overseas financial institution. It is also important to be aware of the exchange rate offered, to determine whether it is competitive, as ultimately when determining the cost of an overseas transfer, the exchange rate is likely to make the biggest difference


International Money Order (IMO)

An international money order (IMO) can be issued by a bank or PostShop. While the cheque is guaranteed, the downside is that you will need to post it overseas and it will need to be cashed at the other end. This will inevitably take longer than an online transfer.

Some possible costs associated with this method include the purchase price (at Australia Post, for example, the purchase cost of an IMO ranges from $8.95 to $23.00 for amounts up to $10,000). There may also be transaction costs at the other end if the cheque is deposited into the overseas account.



For smaller amounts ranging from a few dollars to perhaps a few hundred, Paypal is a money transfer option worth considering. It really is only appropriate for small amounts though as the international transfer fees are not competitive when considered against online money transfer companies.

Generally, the Paypal fees consist of a percentage of the total amount (which can range from 0.5% to 3.3%, depending on the country of destination) plus a fixed fee. If the amount is funded via a credit card, the fees can be significantly higher!


Of course it goes without saying that you should always ensure that the person you are transferring funds to is legitimate. It can be difficult, if not impossible, to recover funds sent overseas if the recipient turns out to be a scammer. The government’s Consumer Affairs site  has some tips on common scams to watch out for.


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