Money Transfer :Before sending money abroad for friends, family or anyone else, it is really essential to understand the right method for sending money. Today, sending money abroad has been made easier; however there are some important methods to know so that you can carry out your work at a minimum cost. This article looks at how to send money abroad, ways to send money safely and quickly, as well as the major considerations when transferring funds internationally.
Overview: What is an International Money Transfer?
Transferring cash internationally involves sending it from one country to another and typically converting it into another country’s money. Banks, specialized organizations for money transfers, single agents, or internet platforms can facilitate this process. The amount of time required for one method can range from minutes to days, and costs can vary considerably.
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The Reserve Bank of India’s Liberalized Remittance Scheme (LRS) sets a limit on the maximum amount of money an individual can remit to India. As per the LRS scheme, any Indian individual (including minor children) can remit up to US$250,000 each financial year without requiring any approval from the RBI.
Transferring cash internationally involves sending it from one country to another and typically converting it into another country’s money. Banks, specialized organizations for money transfers, single agents, or internet platforms can facilitate this process. The amount of time required for one method can range from minutes to days, and costs can vary considerably.
The Reserve Bank of India’s Liberalized Remittance Scheme (LRS) sets a limit on the maximum amount of money an individual can remit to India. As per the LRS scheme, any Indian individual (including minor children) can remit up to US$250,000 each financial year without requiring any approval from the RBI.
Best Ways to Send Money Internationally
If one needs an option for transferring funds to other countries, there are numerous avenues open. Fulfillment might vary from the speed at which transaction would take place or how much it costs. American people often prefer these alternatives when they need to send cash beyond borders:
1. International Money Order
International money orders involve depositing money into a bank account that can then be cashed at any check-cashing location in the destination country, one of the oldest and most traditional methods. Although it is simpler and less costly than other means, this method may take a longer time to reach its intended recipient.
2. Online Money Transfer
For many, online money transfer services have become popular because of their convenience. To start a transfer, you usually need to know the recipient’s bank account info – like their SWIFT code or IBAN for the bank they are sending money to – and details about who the account belongs to. However, although this method seems simple enough, it often comes with a price as charges imposed by middlemen can be quite high.
3. Online Wire Transfer
Contemporary versions of classic bank wire transfers are online wire transfers. They frequently have lesser charges as they don’t require intermediary banks for doing the transaction. The method is widely dependable and secure, with companies like Western Union and Book My Forex providing it. However, how much time it will take for the funds to get to the recipient may differ from one service provider to another.
4. Bank Drafts or Cashier’s Cheques
Till now, I have not seen bank drafts and cashier’s chques as one of the paper-based instruments that can be purchased at banks in the currency of the destination country. These instruments are mailed to recipients who can then deposit them into their bank accounts. Although this method is secure and allows tracking of the draft or cheque, it might take a considerable amount of time to reach the recipient.
5. Mobile Money Transfer
The use of mobile money transfer services is on the rise and apps such as PayPal, Paytm, and others allow people to move money internationally right from their mobile phones. Even though it takes a short time, they are convenient and can be done at any place but usually charge more fees if funded through credit card.
Steps to Make an International Money Transfer
Understanding the steps involved in making an international money transfer can help you navigate the process more smoothly:
Step 1: Check Customer ID
Initially, before carrying out a transfer, you will have to check your identity. This is a compulsory stage as per monetary rules so as not to commit deception and respect all legal obligations. Your identification document is normally required at most times only once especially if you are a first-time user.
Step 2: Lock in the Exchange Rate
Because of the unpredictable nature of currency values, it would be wise to get a fixed price when starting the transaction. This ratio will be responsible for determining the amount that would be given to the receiver in their local currency. Immediate fixation of conversion rates should follow after confirmation of your identity.
Step 3: Transfer Payment
Once you have made sure that your exchange rate is set, you are now ready to remit cash for the transfer. This usually happens in a specified time period, which can range from one day to two days. On the other hand, if this payment is not made, it means that your locked exchange rates will have been lost.
Step 4: Money is Converted and Sent
The funds are changed to the currency requested and then sent to the beneficiary bank after the payment has been made to the money transfer service or bank. The duration required for the funds to arrive may vary based on the mode of transfer and among other banks involved with it.
Factors to Consider When Transferring Money Internationally
When choosing a method to transfer money internationally, several factors should be considered:
1. Exchange Rates
Exchange rates are an important driving force behind how much cash is received by your recipient. The rate shows the worth of one currency when compared to another and it can change throughout the day. Verify the current rate before carrying out any transfers.
2. Overhead Charges
Apart from the exchange rate, different charges could arise like change tax, service fee or remittance fee; those are significant total amounts that should be taken into consideration while selecting your mode of transferring money.
3. Transfer Speed
The time it takes for the money to reach the recipient can vary widely depending on the method used. While some services offer near-instant transfers, others may take several days. Consider how quickly the recipient needs the funds when choosing a service.
4. Security
Security is paramount when transferring money internationally. Ensure that the service you use is reputable and complies with international financial regulations to protect your funds and personal information.
Featured Partners for International Money Transfers
Partner | Key Features | Transfer Fees | Exchange Rate | Transfer Speed | Supported Countries |
Wise (formerly TransferWise) | Real exchange rates, low fees, easy-to-use app | Low and transparent fees | Mid-market rate (no markup) | 0-2 business days | 70+ countries |
Western Union | Extensive global network, multiple transfer methods (online, in-person, mobile) | Varies by amount and location | Exchange rate markup applies | Minutes to days (depends on method) | 200+ countries |
PayPal | Instant transfers, widely recognized, easy for personal use | 2.9% + fixed fee | Exchange rate markup applies | Instant to 1 business day | 100+ countries |
Remitly | Special offers for first-time users, guaranteed delivery time | Varies by country | Competitive rates | Minutes to 5 business days | 50+ countries |
OFX | No transfer fees on large amounts, 24/7 customer support | No fees above a certain amount | Marginal exchange rate markup | 1-2 business days | 190+ countries |
XE Money Transfer | No fees, well-known brand, transparent pricing | No fees | Competitive rates | 1-4 business days | 130+ countries |
WorldRemit | Multiple payout options (bank deposit, cash pickup, mobile wallet) | Low fees, varies by method | Competitive rates | Minutes to days | 150+ countries |
Xoom (by PayPal) | Fast transfers, backed by PayPal, wide network | Fixed fees + exchange markup | Exchange rate markup applies | Minutes to a few days | 130+ countries |
MoneyGram | Large global network, cash pickup available | Varies by country and method | Exchange rate markup applies | Minutes to days | 200+ countries |
Final Thought
Dollars matter when it comes to international transfers so are speed and safety. In case you are sending monetary support to your family, paying for education abroad or managing international trade, the best method will also save you time and money
Make sure to compare exchange rates, costs involved in sending your money as well as delivery times over various services and give priority to transparent and reliable ones. Informed choice on what suits your needs is what will help ensure that your cash reaches its destination safely and effectively.
FAQ
What documents are required to transfer money internationally?
Typically, you’ll need a valid ID such as a PAN card, along with proof of the transaction like an original bill, receipt, or fee slip.
What is the current exchange rate of USD to INR?
Exchange rates fluctuate constantly. To get the most accurate and up-to-date rate, check a reliable financial news website or use an online currency converter.
Can I send money to someone who doesn’t have a bank account?
Yes, services like Western Union and MoneyGram allow you to send money to individuals who can collect the funds in cash from a designated location, even if they don’t have a bank account.Yes, services like Western Union and MoneyGram allow you to send money to individuals who can collect the funds in cash from a designated location, even if they don’t have a bank account.
What is the cheapest way to send money internationally from India?
Online money transfer services, especially those that offer low or no transfer fees like Wise and OFX, are generally the cheapest ways to send money internationally from India.
Can you use PayPal for international money transfers?.
Yes, PayPal can be used for international money transfers, though it tends to be more expensive compared to other options due to higher fees and exchange rate markups.
Does Zelle work internationally?
No, Zelle is a U.S.-based service and does not support international transfers. You would need to use another service for sending money abroad.