Transferring funds is a regular task for most people and so international money transfer is something millions of people around the world do every day. From the global companies that make international bill payments down to the migrant worker who sends money home to his loved ones.
But this very task can be tricky and costly if not done smartly. Most people making international transfers are not aware of the hidden fees. Whether you use a Bank, money Transfer Companies or Foreign exchange brokers to send money abroad two costs are usually involved. The first is the cost of the service to transfer the funds and the second that is not so obvious is to convert your money from one currency to another.
These service providers make a profit by exchanging your currency at a lesser rate because do not convert your money based on the current inter-bank exchange rate. This is a common practice and a vital revenue stream for providers. So take note, because they are not always so upfront with this cost and honestly you might be incurring high costs without you knowing.
That said here are some of the ways you can transfer money safely.
These are regulated financial institutions and are efficient in transferring substantial amounts due to their apparent security. It is the most commonly used method of money transfer by corporations, small businesses, and even individuals. But due to their hidden transfer fees and other cheaper methods of sending funds, banks are losing ground in the international funds transfer market. To transfer funds through a bank just go to a local branch and ask the customer service and they usually charge people anywhere from $10 upwards it all depends on the amount.
Foreign Exchange Brokers:
They are the middleman between the customer and the banks. The primarily deal in currency exchange but will transfer funds for a fee. However, the process is rather slow because it can take several days to open an account. Foreign exchange services are beneficial for small businesses making international payments.
Money Transfer agencies:
Money transfer providers are much cheaper when making international transfers in small amounts. But they also have the same dual costs as banks and foreign exchange firms. They use a bank to bank transfer system although some provide additional methods of receiving funds including cash pick up branches.
Online Money Transfer Providers:
Online money transfer providers provide cheap international transfers to customers and still manage to make a profit. Transfer charges can be as little as $1 and due to competition, some providers wave the fee. Some providers have a mid-market rate which they use to decrease costs for users.
These money transfer providers have secure methods of sending and receiving using the latest in financial technology and are regulated by financial authorities of their country of origin.
That said using your computer or smartphone to make fast and easy payments is better compared to the hassles of visiting a local branch.