Money transfer is the process of moving money from one account to the other. The account could be a bank account, credit union account, or a mobile wallet. Money transfer can happen both domestically and internationally. There are various transfer platforms you can use to move money to other countries of the world, including PayPal, Payoneer, Skrill, and Western Union. But what is the cheapest way to send money internationally?
When sending money, you must put into consideration the cost of the transaction. Every money transfer platform has its guidelines on how to charge money transfers. When you send money at a low cost, you can save significant amounts of money. Fees can vary depending on the currency you are using. When sending money in USD, the transaction cost may be lower than when you send in CAD or GBP.
Another thing to consider is the withdrawal cost of the platform you are using to send money with. The person or company receiving the funds should not pay too much to withdraw the funds. If you are transferring money to a friend or a family member, you might include the withdrawal fee in their country. Therefore, you should not be lured by cheap transfer costs when the withdrawal costs are high.
What are the things to consider when transferring money internationally?
When you want to transfer money to an international recipient, you do not just wake up and start transferring money with any transfer service. There are various factors you should consider. They include the following.
i) Transfer fees
Every service provider will charge you some fees when you use their platform to move money internationally. You should be keen to see the cheapest platform to save a substantial amount of money. Some transfer agents may hide some fees only for you to find out later.
ii) Exchange rates
When you search the current exchange rate, you will find the general figures. However, each transfer agent will have exchange rates that may factor in the exchange fees. Banks usually have the worst exchange rates. You should consider other transfer platforms such as Western Union, Wise, and Payoneer, among others.
iii) Transfer time
The time taken to transfer funds from one platform to the other differs depending on each transfer service guideline. Traditional banks usually take several days to complete an international transfer. However, a money transfer company like Wise can take a day to complete the transaction process.
iv) Security and financial protection
You do not want to send money using an insecure platform where you can lose your money easily. Transfer sites should encrypt money transfer information to ensure that hackers do not access it. Furthermore, you should send money with a transfer service which has some sort of regulations by the government.
v) Ease of transfer
If you are using an online transfer platform, chose a site that is easy to navigate. Things need to be easy when dealing with money. If a transfer platform is complex, it can be tricky to carry out a transfer process.
When transferring money to international recipients, you should choose online platforms since you only need your phone and a secure internet connection to get started. Even when moving money domestically, you can do it better use an online transfer site.
For example, when you want to transfer money from Chime to a bank account, you only need to access your Chime account online and finish the process within minutes instead of lining up at a bank’s physical office.
What Is the cheapest way to send money internationally?
Having researched the available transfer options to move money internationally, I have found that Wise is the cheapest way to transfer money internationally. Wise, formerly called TransferWise, allows you to transfer money using your bank account credit card or debit card.
When sending money using Wise, you only need to visit its website and create an account. Start by keying in your email address and click next for further instructions. You can also use your Facebook, Gmail, or Apple account. Once your
Wise account is ready, you can then begin your transfer process. You can move along in three main steps to transfer money to international recipients. They include the following.
1) Choose your payment method
When you are transferring money, you first need to choose which method to use. As I mentioned earlier, you can use a credit card, a debit card, or a bank account. A bank account is the cheapest payment method that you can use to transfer money abroad.
For example, when sending $1000 to a GBP currency account, you only pay 6.50 USD as the total transfer fees. The fee includes a 1.60 USD bank debit (ACH) fee plus a 4.90 USD Wise fee. That translates to 0.60% of the amount to transfer.
2) Get the cheapest rate possible
Wise transfer rates are the best in most times of the year. Interestingly, they keep changing, and you can even send at a lower rate than what you see at the time of sending. You can sign for rate alerts to receive notifications in your email address when the rate changes.
3) Money is delivered
The international recipient gets the funds in their bank account in their local currency and they can then withdraw over the counter or via an ATM. You can even transfer money from your account to other bank accounts or mobile wallets.
There are several payment ways you can use to transfer money with Wise to an international recipient. They include;
4) Direct Debit
When you use direct debit to transfer money at Wise, you authorize Wise to take money from your account. The process is a bit expensive than when using a bank transfer. Funds may take some time to appear in the Wise account.
5) Debit Card
You can utilize your debit card to pay for your Wise transactions. The process is easy and fast. Furthermore, it is cheap than credit cards as far as processing cost is concerned.
6) Credit Card
Even though it is expensive to use a credit card to fund your Wise transaction, credit cards are fast and easy to use. Wise supports Visa, Mastercard, and some Maestro cards.
7) Bank Transfer
Bank transfers are the cheapest when transferring money with Wise. Bank, transfers are slower than debit and credit cards but eventually, you save a lot of money in a single transaction.
Why should you choose Wise to move money internationally?
Apart from low transfer costs, there are various reasons why you should consider Wise as the best transfer platform. They include the following.
- The site is secure from attacks by hackers since it has data encryption tools.
- It is easy o use Wise since you need an online account to move money.
- You have several ways to fund your transaction. Wise allows you to use your debit card, credit card, or bank account to fund your transactions.
- Financial protection. Wise is regulated by the Financial Conduct Authority (FCA) in the United Kingdom, and thus, you can send money with peace of mind.
- Wise supports numerous currencies. You can send money using various world currencies, including AUD, BGN, CHF, CZK, DKK, EUR, NZD, GBP, HRK, HUF, CAD, JPY, NOK PLN, and RON, among others.
What other ways can I use to transfer money internationally?
There are other ways you can use to move money internationally. They include the following.
a) Bank account
Banks allow you to send money with a checking account number instantly to bank accounts of the same bank within the country. You can also use a bank account to transfer money internationally using the wire transfer service. The transfer method is suitable when moving large amounts of money, which is needed with urgency.
PayPal is a money transfer platform that allows you to move money to various countries of the world. Opening a Paypal account online is very easy as you only need an email address, a government ID, phone number, and a physical address. You can use your bank account or debit card to fund your PayPal account. Other PayPal users can send money to your account to add to your balance.
Payoneer also works like PayPal in that you can move money to other Payoneer account holders. You only need their Payoneed ID, and there you go. The platforms support several currencies of the world, which means you can transfer money to many destinations. Recipients can withdraw money to their bank accounts or spend it online.
d) Western Union
Western Union is a money transfer agent like Wise and allows you to move money internationally when you create an online account. You can also use Western Union services at a physical branch to pay for your transaction using cash. Western Union allows you to fund your transaction using your bank account, credit card, or debit card.
MoneyGram operates almost the same as Western Union in that it acts as an intermediary to move money. There are various locations in the world where people can send and receive money.
Money transfer refers to moving money from one account to the other. International money transfer involves various transfer agents who work online, at physical branches, or both. Some fees accompany the transfers, and each transfer agent charges differently according to their terms and conditions. International money transfer platforms include PayPal, Wise, Payoneer, some banks, and MoneyGram. Wise has cheaper money transfer services.